Gujarat's Mundra Port To Undergo Rs 45,000 Crore Expansion, To Double Capacity

V Bhagya Subhashini

Jun 18, 2024, 01:07 PM | Updated 01:06 PM IST

Adani Mundra Port, Gujarat.
Adani Mundra Port, Gujarat.

Adani Ports and Special Economic Zone Ltd (APSEZ) has secured key environmental and coastal regulation zone approvals from the Centre to more than double the capacity of its flagship port at Mundra to 514 million tonnes, with an investment of Rs 45,000 crore.

This approval could bolster APSEZ's case for seeking an extension from the Gujarat government on the concession period for the port, which is set to end in 2031 after a 30-year tenure.

Located in Gujarat’s Kutch district, Mundra Port is the largest commercial port in India. It currently has a design capacity and environmental clearance to handle 225 million tonnes of cargo annually, including 9.5 million twenty-foot equivalent units (TEUs).

In fiscal 2024, it managed 179.6 million tonnes of cargo, including 7.4 million TEUs, making it India’s largest commercial port and top container port by volume.

APSEZ expects Mundra Port to handle over 200 million tonnes of cargo in FY25, potentially becoming the first Indian port to reach this milestone. Globally, a 70 per cent capacity utilisation is considered ideal for efficient port operations, and Mundra is rapidly approaching its full capacity, reports Deccan Herald.

To accommodate the increasing demand, APSEZ applied to the Expert Appraisal Committee (EAC) of the Ministry of Environment, Forest and Climate Change to increase the port’s capacity by 289 million tonnes as part of the Waterfront Development Plan spread over 3,335 hectares. The expansion will cater to multi-purpose, liquid, gas, and cryogenic cargo.

“The EAC, after examining the documents submitted by APSEZ and detailed deliberations held on 15 May 2024, recommended the proposal for the environment and CRZ clearance,” according to the committee’s meeting minutes. The recommendation now awaits formal approval from the Ministry of Environment, Forest and Climate Change.

Mundra’s expansion is crucial for APSEZ’s goal to become the world’s largest transport utility and port operator by 2030.

Currently, APSEZ operates 15 ports/terminals on India’s coastline with a combined capacity of 627 million tonnes annually. It also manages the Haifa Port in Israel, a container terminal at Dar es Salaam Port in Tanzania, and is developing a terminal at Colombo Port.

The original concession agreements for private ports like Mundra, awarded by the Gujarat government over two decades ago, do not include an automatic extension clause. However, the state’s port policy, established in 1997, provides options for extension. The government will determine the terms for extending concessions for all ports with expiring 30-year agreements in the coming years.

V Bhagya Subhashini is a staff writer at Swarajya. She tracks infrastructure developments.

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