2014 polls to bring Sethusamudram project back onto political agenda

A project that has great significance to India’s economy hangs in the balance, and political parties are sparing no efforts to garner votes in its name.
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First Published: Thu, Jul 18 2013. 11 08 PM IST
In the absence of a continuous navigational channel, the international shipping route circumnavigates Sri Lanka due to the presence of a reef, known as Adam’s Bridge (pictured), located southeast of Rameswaram near Pamban in Tamil Nadu. Photo: NASA
In the absence of a continuous navigational channel, the international shipping route circumnavigates Sri Lanka due to the presence of a reef, known as Adam’s Bridge (pictured), located southeast of Rameswaram near Pamban in Tamil Nadu. Photo: NASA
The Dravida Munnetra Kazhagam (DMK), a prominent political party in the southern Indian state of Tamil Nadu, has started efforts to revive one of India’s most controversial and ambitious maritime projects to gain political mileage in the run-up to the May 2014 national election.
DMK was a key ally of the ruling United Progressive Alliance (UPA) government led by Prime Minister Manmohan Singh until it broke away last year.
The first signs of a DMK campaign on the stalled Sethusamudram ship canal project became evident last week when party treasurer and former deputy chief minister M.K. Stalin urged state chief minister J. Jayalalithaa to withdraw the affidavit filed by the Tamil Nadu government in the Supreme Court against the stalled project.
DMK workers held demonstrations in many parts of Tamil Nadu demanding the speedy implementation of the project.
The DMK, Stalin said, would intensify the protest, including launching a jail bharo (fill the jails) agitation, if the petition was not withdrawn.
If the project is implemented, Tuticorin port will turn into an engine powering the development of Tamil Nadu as Mumbai has done for Maharashtra, according to the DMK.
The Union government has budgeted a token Rs.5 crore for the project in the financial year that started in April.
The Sethusamudram project seeks to create a shorter shipping route between the east and west coasts of India but has been halted since July 2009 after the last dredger digging the new channel was pulled out of service that month at the end of a four-year contract between state-run Dredging Corp. of India Ltd (DCI) and Sethusamudram Corp. Ltd.
Billed as India’s Suez Canal, the Rs.2,427.4 crore Sethusamudram ship canal project is expected to reduce the journey between the west and east coasts by as much as 36 hours, or up to 424 nautical miles (1 nautical mile = 1.82km), by creating a channel between the Indian mainland and Sri Lanka.
Shipping companies can save on bunker (ship fuel) while India’s manufacturers and traders will gain from a reduction in maritime transportation costs.
Sethusamudram Corp. is the special purpose company that was formed by state-run firms such as DCI, Shipping Corp. of India Ltd (SCI), Vizag Port, Ennore Port, Chennai Port, Paradip Port and VO Chidambaranar Port to raise funds and implement the project.
Ships currently need to go around Sri Lanka. In the absence of a continuous navigational channel, the international shipping route circumnavigates Sri Lanka due to the presence of a reef, known as Adam’s Bridge, located southeast of Rameswaram near Pamban in Tamil Nadu.
The Sethusamudram project involves digging a new shipping lane connecting the Gulf of Mannar and the Bay of Bengal through the Palk Straits and Palk Bay.
Dredging work in the Adam’s Bridge region, the controversial part of the project, was stopped in the wake of the Supreme Court’s orders on 31 August and 14 September 2007 on the basis of petitions filed by individuals and groups opposed to it.
Hindu groups, led by the Vishwa Hindu Parishad (VHP), opposed the project on the grounds that it would destroy a rock and sand ridge created by divine hand as recounted in the Ramayana.
Dredging work on the Palk Straits, which wasn’t as controversial, carried on for another two years. If the project is revived, the dredging will need to be done again as the channels have silted up.
Any resumption will need to take into account the findings of a panel set up on the orders of the Supreme Court. It had asked the committee of experts headed by R.K. Pachauri, director general of The Energy and Resources Institute (TERI), to consider an alternative alignment for the project. The Pachauri panel said in its report submitted in July 2012 that an alternative alignment was not “economically and ecologically feasible”.
India’s shipping ministry, which is headed by Congress party lawmaker G.K. Vasan, who hails from Tamil Nadu, is in no mood to accept the report of the Pachauri committee in view of the political ramifications.
The government has so far spent Rs.766.82 crore on the project.
The Bharatiya Janata Party (BJP), the nation’s principal opposition party, will most likely launch an agitation if the government goes ahead with the project, given its stand on the issue. The DMK will oppose any move to shelve the project that it considers essential for the economic development of Tamil Nadu.
The work on dredging the new shipping lane started on 2 July 2005 and was to be completed within 180 weeks, or about three-and-a-half years.
The controversy has delayed the completion of the project and has raised the project cost.
The delay has also hurt SCI and DCI, both state-owned, that had invested Rs.50 crore and Rs.30 crore, respectively, as equity in the project. SCI had to make a provision for the reduced value of its investment in Sethusamudram Corp. for the year ended March 2013, which was announced in May when the fiscal year results were announced.
DCI is, meanwhile, seeking arbitration to recover Rs.426.41 crore for its work on the project.
A project that has great significance to India’s economy hangs in the balance, and political parties are sparing no efforts to garner votes in its name.
P. Manoj looks at trends in the shipping industry.
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First Published: Thu, Jul 18 2013. 11 08 PM IST
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