Chinese consortium to partner Kerala in Vizhinjam port

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Thiruvananthapuram, Jan 18: A three-firm Chinese consortium - with Mumbai-based partner Zoom Developers in tow - has been picked by Kerala Government as partner for the construction of Rs 4,360-crore Vizhinjam port, slated to be world's deepest port. Kerala Cabinet, which met here on Wednesday, approved the consortium's tender.

"Prime Minister Manmohan Singh, during his Kerala tour next month is likely to lay foundation stone for the mega project. PMO has been requested to include Vizhinjam project in tour plan," Chief Minister Oommen Chandy told reporters, after the Cabinet meeting. Vizhinjam Deepwater International Transhipment Terminal is expected to cut down the 11.4% freight costs of Indian exporters (compared to 6.1% freight cost world average) substantially.

After the techno-economic analysis of the bids, it is the Chinese group - including Kaidi Electric Power Co, Chinese Harbour Engineering Co and a Chinese construction firm and the Indian firm Zoom Developers - that the state government had found feasible, Mr Chandy said. Oommen Chandy Government had handpicked Vizhinjam project among the 10 projects in fast track.

Only two infrastructure players - Zoom Developers-backed Chinese consortium and Mumbai-based Gammon India - figured in the final reckoning for the Rs 1850-crore Phase I of the Rs 4,360-crore port. About 22 firms, including UK-based Beckett Rankine, Marubeni Corporation (Japan), US-based Giss-Eta, New York-based First Wallstreet Group and Consortium, Ital-Thai Development Company (Bangkok), Afcon Infrastructure (Mumbai) L&T ECC, Sical Logistics, IL&FS, Malta-based Hili Company, Ahmedabad-based Adwani Ports and Essar Shipping, are among those who had picked up the RFQ (request for qualification) papers. Many bidders had sought a 100-year BoT tenure, while Kerala government insisted on a 30-year tenure.

Defying the tradition of 26% share for the government partner, Kerala government - through the SPV (special purpose vehicle) Vizhinjam Port International - has limited its own stake to 24% in the port project. A study by L&T Ramboll works out at least Rs 1000 crore revenue, as soon as the first phase is completed in five years.

The Cabinet also cleared the `Dream City' project in Kozhikode proposed by the Tourism Department. It would be implemented as an eco-tourism project, Mr Chandy said. The earlier decision to give 25 kg of foodgrains to 20 lakh BPL families at Rs 3 per kg will be operational from February 1, he said.