Baalu scales down returns from Sethusamudram project to 10%

Chennai, Sept 14 | Updated: Sep 15 2005, 05:30am hrs
The Rs 2,427-crore Sethusamudram project is expected to give a return of 10%. With the interest rates falling, this might go up, Union shipping and road transport minister TR Baalu said here on Wednesday.

However, he said any government investment decision was normally based on an expected annual return of 12%.

The user charges for the ships that would pass through the Sethu canal would be decided once it was completed and after having consultations with all the stake holders, Mr Baalu said after inspecting various road connectivity and other development works for the Chennai and Ennore ports. Agreements will be signed shortly with the Suez Canal and Panama Canal authorities to get expertise on this issue.

The Sethusamudram project has also a Rs 60-crore component for the benefit of fishermen. The proposed works include a multi-purpose port at Rameswaram and fishing harbours at Thondi, Sethupavachathiram and Mallipattinam. The Nagapattinam port will also be expanded. Mr Baalu said the state government has not so far submitted any proposal regarding these projects.

He said the Sethusamudram project would in no way affect the fishermen. If any adverse impact was reported, steps would be immediately taken to eradicate that, he added.

Dredging works would not affect the fish production, the minister said. Every port was undertaking maintenance dredging and that had not been impacting the growth of fish production, he added. Even when the Tuticorin port was being built there were objections saying it would reduce fish catch.

In fact the production only increased. The fish production was only 55,000 tonne in 1992 in Tuticorin. In 1998, it had gone up to 1.05 lakh tonne.