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Kerala looks to Centre as Lanco exits port terminal

Kerala looks to Centre as Lanco exits port terminal
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First Published: Fri, Jun 26 2009. 12 42 AM IST
Updated: Fri, Jun 26 2009. 12 42 AM IST
Kochi/Bangalore: Kerala proposes to ask the Union government to take over development of the Rs5,340 crore container trans-shipment terminal at Vizhinjam near Thiruvananthapuram, after Lanco Infratech Ltd said late Wednesday it was walking out of the contract.
L. Radhakrishnan, managing director and chief executive of Vizhinjam International Seaport Ltd, said Lanco, which was awarded the contract last May, blamed the delay and legal tangles surrounding the project for its decision.
Vizhinjam International is a special purpose company set up by the Kerala government to implement the project.
The Vizhinjam port is designed to eventually handle 5.3 million standard containers a year.
Lanco’s decision comes days after Mumbai-based Zoom Developers Pvt. Ltd said it would move court again after an evaluation committee rejected its bid, saying it didn’t meet the minimum qualifying criteria. The Supreme Court had asked the state government to re-evaluate Zoom’s bid.
M. Vijayakumar, Kerala ports minister, said in the state assembly on Thursday that one solution was to ask the Union government to take over the project, similar to the international container trans-shipment terminal coming up at Vallarpadam under the aegis of the Union government-owned Cochin port.
“The Centre may not be willing to do this because it would pose a direct competition to the Vallarpadam project and affect its viability,” said a shipping ministry official, asking not to be named.
Small vessels from regional ports use trans-shipment terminals, where bigger container ships can call, to load or unload cargo to or from the larger ships on to their final destinations.
Lanco could not be reached for comment.
M.P. Taneja, director of corporate affairs at Zoom Developers, said the firm was keen to handle the project. “We are going through the technicalities of ensuring that all objections against us are vacated by the court so that we get the contract,” he said. “We are trying to ensure that every objection against us is answered to the full satisfaction of the Kerala government so that we get an unfettered contract.”
The Vizhinjam project has been long in the making. The first tender for the port, on a build, operate and transfer (BOT) basis for 30 years, was invited in 2003. No bids were received then and a fresh tender was called in 2005, but the project has made no headway in the years since.
Experts say that Vizhinjam, with a natural depth of 20m, needs no maintenance dredging and has the potential to become India’s deepest container port.
The port, with a back-up area of 150 acres, is also located just 9 nautical miles from the international maritime route.
ajay.m@livemint.com
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First Published: Fri, Jun 26 2009. 12 42 AM IST