Kerala has requested the Centre for approval of viability gap funding for the multi-thousand crore Vizhinjam international sea port and container transhipment terminal project near here.
Chief Minister Oommen Chandy has written to Prime Minister Narendra Modi seeking personal intervention in the matter.
The Chief Minister also took the opportunity to reiterate the demand for exemption from Cabotage rules for the mega port.
Viability Gap Funding is a one-time or deferred grant provided to support infrastructure projects that are economically justified but fall short of financial viability. ‘
The Rs 6,647-crore Vizhinjam project is proposed to be set up through the design, build, finance, operate and transfer mode.
It has been structured in line with the guidelines for viability gap funding for financial support, the Chief Minister recalled.
GRANT AMOUNT
Under the scheme, the Centre provides funds to infrastructure projects that are to be undertaken through public private partnerships.
The amount will be equivalent to the lowest bid for capital subsidy, but subject to a maximum of 20 per cent of the total project cost.
The Empowered Institution under the Finance Ministry that decided on the grant of funds under the Scheme is scheduled to consider the application for Vizhinjam on Thursday.
10-YEAR EXEMPTION
Cabotage rules are concerned with grant of permission for carrying of cargo between two points within a country by a vessel registered in another country.
Permission to engage in cabotage is restricted in most countries, including India, to ensure that interests of domestic shipping companies are secured.
The Chief Minister asked for a relaxation of the Cabotage rules for at least the first 10 years from the start of commercial operations at the port.
He recalled in the letter that the Vizhinjam project had secured environmental clearance and had acquired 90 per cent of the land needed.