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The upcoming ₹76,220-crore Vadhavan port, for which Prime Minister Narendra Modi will perform a groundbreaking ceremony on Friday, will play a “crucial role” in the proposed India–Middle East–Europe Corridor (IMEEC) and the International North–South Transportation Corridor (INSTC) projects, said the Union Minister for Ports, Shipping and Waterways, Sarbananda Sonowal.
The capacities created at the port will aid export-import trade flow through the IMEEC and INSTC, he told businessline during an interview.
The upcoming terminals will be capable of handling mainline mega vessels plying on international shipping lines between the Far East, Europe, the Middle East, Africa and the Americas, he said.
“The Vadhavan port is crucial for enhancing India’s connectivity with the Middle East and Europe. The port’s deep draught will accommodate mega container vessels, facilitating trade through IMEEC and the INSTC,” Sonowal said.
Survey underway
Survey for the IMEEC is underway, sources said. RITES Ltd, the railways PSU, has started feasibility studies along the India–Middle East segment.
The Maharatna company has set up an ‘IMEEC Cell’ and is “working with stakeholders” to “provide ease-of-doing-business”, the sources said.
RITES signed an MoU with Abu Dhabi Ports Group, the developer and regulator of ports and related infrastructure in Abu Dhabi, in February. The two organisations are analysing the feasibility of filling the missing links along the existing rail corridor that passes through the UAE, Saudi Arabia, Jordan and Israel.
The areas under study include simplification of customs procedures, integration of IT systems, logistics connectivity, support systems, and so on.
It is also exploring the feasibility of connecting India’s ports on the west coast to the Dedicated Freight Corridor and identifying the infrastructure gaps.
Sources said Vadhavan port will make India “fully ready” to handle any additional demand generated by the IMEEC. Expansion is underway at existing ports like Mundra, Kandla, JNPT and Mumbai.
“The Vadhavan port project will add 23.2 million TEUs (twenty-foot equivalent units) to India’s container handling capacity. It will involve the construction of a new all-weather port with advanced terminal facilities, supporting India’s growing exim trade,” Sonowal added.
Funding
According to Minister Sonowal, the Vadhavan port project would be funded through a mix of public-private partnership (PPP) and engineering, procurement, and construction (EPC) models. The Vadhavan Port Project Limited (VPPL) — the special purpose vehicle for carrying out the construction activities — will fund the core infrastructure (on EPC), pegged at ₹21,267 crore
The private funding (under the PPP model) will include two components — reclamation and dredging, at a projected cost of ₹17,709 crore; and the setting up of terminals and other commercial infrastructure at ₹37,244 crore.
The creation of additional road and rail connectivity will cost an estimated ₹2,881 crore and ₹1,765 crore, respectively, and will be funded through the National Highways Authority of India (NHAI) and the ministry of road transport and highways (MORTH).
The special purpose vehicle will have a 74:26 stake between Jawaharlal Nehru Port Authority (JNPA) and Maharashtra Maritime Board (MMB).
“Major national and international port operators and infrastructure developers will likely express interest in participating,” the minister said, adding that the detailed project report for the Vadhavan port has already been prepared and approvals received from authorities concerned.
Environmental and coastal regulation zone clearances have been granted, and the Public Investment Board (PIB) has recommended the project.
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