The State government is exercising a great deal of caution in finalising the bid received from a consortium of companies led by Welspun Infratech Ltd (India) for taking up the Port Operator’s role in the Vizhinjam Port project.

This is because only one bidder is in the scene and that bidder had sought an upfront grant of Rs.479.54 crore from the government over a period of 16 years to operate the port.

Ports Minister K. Babu said a special committee consisting of the Chief Secretary, Ports Secretary, Expenditure Secretary and Law Secretary would renegotiate the terms with the Welspun consortium. “We hope to receive the report from the committee by June-July,” he said.

According to A.S. Suresh Babu, Managing Director and Chief Executive Officer of Vizhinjam International Seaports Ltd (VISL), the special purpose vehicle set up to facilitate the setting up of the project, the Port Operator’s role will come only after the State has created the basic port infrastructure. This will be by 2015. So there is time, he told The Hindu.

The government’s plan is to commission the first phase of the project, which is estimated to cost Rs.4,010 crore, by 2015. The project is conceived along the ‘landlord model,’ with the government investing Rs.3,040 crore on the port infrastructure and the port operator a sum of Rs.970 crore on the superstructure. The port operator can run the port for a period of 30 years.

Mr. Suresh Babu said the immediate tasks being attended to by the VISL include land acquisition (which is progressing smoothly), preparation of the master plan and EPC (engineering, procurement and construction) tender document, mobilisation of funds to the tune of Rs.2,000 crore and, above all, winning environmental clearance for the project. All-season data gathering for the environmental impact assessment is now going on at Vizhinjam and will be completed by June.