Centre's options for funding Sethusamudram project

CHENNAI, JUNE 1. The Centre will consider various options to fund and implement the Sethusamudram project, including through a special purpose vehicle (SPV) in which major ports on the eastern coast will have an equity stake.

Private companies will be allowed 49 per cent stake in the SPV, which will take the build-own-transfer route to implement the project of deepening the sea channel between India and Sri Lanka.

The project, to be developed in phases, is estimated to cost Rs. 800 crores, said the Union Minister of Shipping, T.R. Baalu.

The Ministry, he told presspersons today, had directed the Tuticorin Port Trust, nodal agency for the project, to submit its application to the Tamil Nadu Pollution Control Board before June 15, seeking environmental clearances.

Mr. Baalu said that "much has been talked and written" about the project conceived 140 years ago. On implementation, it would reduce 350 nautical miles of travel and facilitate the movement of "big cargo ships." Inadequate draught now made vessels from the eastern and western coast go around Sri Lanka to reach the other side.

The draught proposed is seven metres and, initially, only one-way movement of vessels would be permitted and he did not foresee any Left opposition to private sector participation.

He expressed confidence that the Tamil Nadu Government would shed its reservations on the proposed ferry service between Tuticorin and Colombo.

The State Government was reluctant to permit the service on security grounds, including those linked to the Liberation Tigers of Tamil Eelam. There were a lot of ways to ensure security, he added.

"We have given them [the State Government] 30 days to respond," he said. The Ministry was not averse to extending the deadline, but was keen on launching the ferry service as early as possible.

Mr. Baalu, who is also the Minister of Surface Transport, said the Centre would implement the golden quadrilateral project and look beyond it.

Ninetyfive per cent of the work on the north-south and east-west (highway) corridor would be completed by December.

His Ministry had agreed to develop the Chennai-Tirupati 92-km stretch at a cost of Rs. 60 crores. It had also declared several stretches in Tamil Nadu as extensions of the nearest national highway and would take up work once the State Government transferred the land. Such stretches include Coimbatore-Mettupalayam-Ooty, Dindigul-Theni-Periyakulam, Thanjavur-Kumbakonam-Vridhachalam-Ulunderpet, Radhapuram-Nagercoil and Tuticorin-Kanyakumari.