Ministry approves Adani Group's Vizhinjam Port for India's first transshipment operations
- In Reports
- 03:27 PM, Apr 26, 2024
- Myind Staff
The shipping ministry has granted approval for the Adani Group's Vizhinjam Port to function as India's inaugural transshipment port. Those familiar with the matter disclosed that the recommendation to designate it as a customs-notified port was made earlier this week.
Current regulations mandate approval from the shipping ministry to prevent the authorisation of competing projects prior to reaching saturation capacity at operational ports.
A senior government official informed ET anonymously,"This approval facilitates the establishment of a customs office at Vizhinjam port. It will mark India's inaugural full-fledged deepwater transshipment port. A final endorsement from the Central Board of Indirect Taxes and Customs (CBIC) is anticipated within the next three months."
Adani Ports and Special Economic Zone Ltd (APSEZ) commenced the international transshipment project at Vizhinjam, Kerala in December 2015.
A transshipment port serves as a transit hub where cargo is transferred from one ship to another en route to its final destination.
Originally slated for completion within four years by 2019, the ₹7,700 crore deepwater seaport project is now expected to commence operations within the current financial year. The project aims to capture a portion of the Indian cargo market, which exceeds a million containers annually and is currently transshipped through foreign ports like those in Colombo, Sri Lanka.
APSEZ reports that container volumes are quantified in twenty-foot equivalent units (TEUs), with one TEU approximately equivalent to a standard size container.
The port, according to APSEZ, provides extensive automation to ensure swift vessel turnaround, alongside cutting-edge infrastructure capable of accommodating Megamax containerships—the largest vessels currently operational worldwide.
In its first phase, the port is set to have a capacity of one million TEUs, with an additional 6.2 million TEUs planned for subsequent phases. It is estimated that nearly 75% of India's transshipment cargo is currently processed at ports located outside the country, with ports in Colombo, Singapore, and Klang handling approximately 85% of this cargo.
APSEZ is scheduled to announce its financial results for January-March 2024 on May 2. In the 2023-24 fiscal year, the company globally managed 420 million metric tonnes of cargo, marking a 24% year-on-year increase.
Image source: The Economic Times
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