India's First-Ever HAM Model In Port Sector To Transform Vadhvan Port Into Global Container Hub

In a significant move to develop Vadhvan Port, the Board of Jawaharlal Nehru Port Authority (JNPA) has approved a Rs 20,647-crore proposal for dredging, offshore reclamation, and shore protection works, to be executed in two phases under a Public-Private Partnership (PPP) Hybrid Annuity Model (HAM).

The first phase involves reclaiming 800 hectares of land over three years, with contractors receiving 60 per cent of the contract value during this period. The second phase will reclaim an additional 400 hectares over two years, maintaining the same payment structure.

The remaining 40 per cent of the contract value for both phases will be disbursed over a 10-year maintenance period, commencing after the project's completion in five years.

As per Economic Times report, this deferred payment model aims to ensure better cash flow management while reducing upfront borrowing requirements for the project.

The proposal will now move to the Ministry of Ports, Shipping, and Waterways for review before being submitted to the Public-Private Partnership Appraisal Committee. The HAM approach, inspired by the National Highways Authority of India (NHAI) but tailored for port development, is being deployed for the first time in India’s port sector.

JNPA has modified the NHAI’s 40:60 payment ratio to a 60:40 split to address concerns raised by private contractors. Maintenance dredging, a significant cost concern, has been excluded from the contract to encourage participation.

Located near Dahanu in Palghar district, Vadhavan Port is projected to handle over 23 million TEUs (Twenty-foot Equivalent Units), heralding a new era of maritime infrastructure and economic ambition in India.

Positioned to be one of the world’s top 10 container ports by 2040, Vadhavan is a state-of-the-art, greenfield port estimated to cost Rs 76,220 crore.

The development will be managed by Vadhvan Port Project Ltd., a joint venture between JNPA (74 per cent stake) and Maharashtra Maritime Board (26 per cent stake), under the landlord model.

Revenue streams for JNPA will include royalties from private operators managing the port’s terminals. These operators will collect berth hire charges, while JNPA retains vessel-related charges, ensuring sustainable long-term earnings.

The strategic location of Vadhavan Port provides it with a unique edge. Situated just 12 km from the Dedicated Rail Freight Corridor and 22 km from the Mumbai-Vadodara Expressway, the port will connect seamlessly to industrial centers across Maharashtra, Gujarat, and beyond.

This proximity ensures efficient movement of goods, reduces logistics costs, and accelerates transit times, making it a competitive trade and transit hub.