In its attempt to fast track the mega port project worth Rs. 6,595cr, the Centre in a recent move has cleared the Viability Gap Fund (VGF) worth Rs 800cr for building Vizhinjam Seaport. The move paved the way for the project, which will be entitled to a maximum assistance of 40% of the project cost of which the Centre will contribute 20% of the amount invested by the port player, Kerala port minister K Babu said, claiming that out of the five companies, whose bids qualified, three are willing to go ahead with financial bids as the latest move will help the tender procedure for the project.
The port development is proposed to follow the landlord port model. Accordingly, the dredging, reclamation and basic external infrastructure work like construction of break-water and quay wall will be taken up by VISL. The proposed project is an all-weather port located on the Southern tip of India, just 10-12 nautical miles from the busy Persian Gulf- Malacca shipping lanes which carry almost a third of the world shipping traffic. The proposed site is endowed with natural depth of more than 20 m as close as one nautical mile from the coast, which means that the dredging and maintenance costs will be minimal, he added.