All You Need To Know About Rs 41,000 Crore Great Nicobar Trans-Shipment Port That Is Set For Construction Soon

The Indian government is finalising the detailed project report (DPR) for a Rs 41,000-crore international transhipment port project in Great Nicobar Island at Galathea Bay.

This ambitious project is set to begin implementation in the next few months. The Great Nicobar Transhipment Port project has faced scrutiny over environmental concerns. However, it has now received environmental clearances and the nod from the National Green Tribunal (NGT), removing any hurdles to its implementation.

"The DPR of the project is also finalised and we are going ahead for its further implementation in the next few months," Ports, Shipping and Waterways Secretary T K Ramachandran stated, as reported by The Hindu.

The project, which will cost Rs 41,000 crore ($5 billion), will be funded by the government and public-private partnership (PPP) concessionaires.

Last year, the Ministry of Ports, Shipping and Waterways announced that 11 players had submitted expressions of interest for the project, including companies like Larsen and Toubro Ltd, Afcons Infrastructure Ltd, and JSW Infrastructure Ltd.

The project will adopt a landlord-mode PPP model, giving the concessionaire flexibility to develop storage areas, container handling equipment, and other infrastructure based on market and business assessments.

The concessionaire will be granted a long-term PPP concession of 30 to 50 years, responsible for providing port services and having the rights to levy, collect, and retain charges from port users.

The project will be developed in four phases. The estimated cost for Phase 1 is around Rs 18,000 crore, covering the construction of breakwaters, dredging, reclamation, berths, storage areas, building and utilities, procurement and installation of equipment, and development of the port colony. Core infrastructure development will receive government support.

“Work on Phase 2 will be taken up post-completion of Phase I and after assessing the demand. Separate tenders will be floated for Phase 2. In all likelihood, we are anticipating a maximum of seven years gap between Phase 1 and Phase 2, but if demand picks up, this time gap would be brought down,” an official added.

Significance of the project

Currently, nearly 75 per cent of India's transhipped cargo is handled at ports outside India, with Colombo, Singapore, and Klang handling over 85 per cent of this cargo. More than half of this transhipped cargo is managed at Colombo port.

This project's location is strategic, situated on the international trade route with proximity to existing transhipment terminals like Singapore, Klang, and Colombo.

Key factors driving the project's potential include its proximity (40 nautical miles) to the international shipping trade route, natural water depth of over 20 metres, and the capacity to handle transhipment cargo from nearby ports, including Indian ports.

The proposed port is designed to handle up to 16 million containers per year once fully operational. The first phase, expected to be commissioned by 2028 will handle over 4 million containers.

A Greenfield International Airport has also been planned as part of the holistic development of Great Nicobar Island which will be developed simultaneously with the port.

In addition to these, a power plant and township are also a part of the holistic development of Great Nicobar Island.