Vizhinjam Port to be fully commissioned by May next year: Karan Adani

AHMEDABAD: The much-delayed international container transhipment port at Vizhinjam near Thiruvananthapuram in Kerala will be fully commissioned by May 2024, Karan Adani, Chief Executive Officer, Adani Ports and Special Economic Zone Ltd (APSEZ), whichisbuildingthenewport,hassaid.

“WeexpectthefirstvesseltoberthinOctoberthisyear, that’s when we expect the first equipment to come. We expect the Phase 1 of the port (400 metre quay) to be commissionedbyMarch2024andthebalancebyMay2024. So, we expect the full commissioning of Vizhinjam Port by May 2024,” Karan Adani said recently after the company announcedthefourthquarterandannualfinancialresults.

The new port is designed to cut India’s dependence on nearbyColombotosendandreceivecontainercargo.

According to the concession agreement signed on August 17, 2015, Vizhinjam port was slated to start operationsonDecember3,2019.

Adani Vizhinjam Port Pvt Ltd (AVPPL), the APSEZ unit developing the port, has blamed force majeure events arising from acts of God such as the Cyclone Ockhi, high waves, a National Green Tribunal order, the pandemic, Cyclone Tauktae and reasons attributable to Kerala Government authorities for the delay in achieving the scheduled commercial operation date (COD) set by the concessionagreementfortheproject.

The delay and the reasons behind it are currently being heardbyanarbitrationpanel.

The Vizhinjam project is entitled to receive a viability grant funding/equity support grant of Rs1,635 crore to be shared by the Centre (Rs 818 crore) and the Kerala government (Rs 817 crore) to boost its viability, making it the first and only port project to be offered such a grant. Of this, Rs1,227 crore will be given during the construction phase and the balance during the operation period spanning 40yearsextendablebyanother20years.

ViabilityGrantFunding(VGF)isaone-timegrantgivenby the Central government for supporting public-privatepartnership (PPP) projects in infrastructure that are economicallyjustifiedbutfallshortoffinancialviability.

The VGF was the basis on which the bid was awarded to Adani Ports and Special Economic Zone Ltd (APSEZ), which quotedtheleastgrantofRs1,635croreinanauctionin2015.

The “in-principle” approval for granting VGF to the Vizhinjam port project was accorded by the Centre in February2015.

Adani Vizhinjam Port has secured “final approval” from the Union Finance Ministry’s Department of Economic Affairs in October 2022 for the construction phase VGF of Rs1,227crore.