Indian private port major Adani Ports and Special Economic Zone (APSEZ) signed a concession agreement with the Kerala government on 17 August to develop and operate the proposed Vizhinjam Port.
To be built at a cost of INR40 billion (USD625 million), the ambitious, deepwater facility in the southern state is aimed primarily at arresting the flow of Indian containerised cargo to Colombo in Sri Lanka.
It is estimated that annually about 1 million teu of Indian cargo is transhipped through foreign ports such as Colombo. Development of Vizhinjam is expected to lower the costs of transhipment and benefit Indian trade.
The timeframe for the completion of the 4 million teu facility is four years.
Gautam Adani, chairman of Adani Group, the conglomerate with interests that include power, ports and mining, is, however, hopeful of achieving completion within 1,000 days. Adani said that the first ship would dock at Vizhinjam Port within two years. Construction is scheduled to begin from 1 November this year.
“Given Adani’s impressive track record in completing port projects this time frame is highly realistic,” Manish Saigal, managing director of consultants Alvarez & Marsal India told IHS Maritime.
The proposed port is located 16 km south of Thiruvananthapuram, capital of Kerala and is strategically placed on the international shipping route connecting Europe, the Middle East Gulf, and the Far East.
Adani operates a total of seven ports and terminals in India and is in the process of building a fourth container terminal in Mundra in the western state of Gujarat and another container terminal in Ennore in the southern state of Tamil Nadu.
Total cargo handled by Adani Ports during the first quarter ending on 30 June 2015 rose by 17% to 40 million tonnes. Net profit increased by 13% to INR6.4 billion.