Vallarpadam Container Terminal, slated to be India’s largest international container terminal (ICT), is likely to miss its commissioning deadline in 2009, if the pace of Rs 246-crore rail and Rs 557-crore road links to the site is any signpost.
Last week, Union shipping ministry sent an admonishing missive to the Kerala government that the time overruns in land acquisitions could snowball to huge cost-overruns for the project.
Dubai Ports World, the BoT partner in the infrastructure project, besides the central and Kerala governments, is equally worried. DPW pins as much Rs 2,200-crore worth hopes on the one-million TEU terminal, planning to upgrade it to 3 million in later phases. If the terminal is not ready by November 2009, DPT may slap a penalty fee.
The Centre has so far spent about Rs 1,180-crore on the project, including in dredging. The work of Rail Vikas Nigam, which has undertaken rail connectivity, is also stalled because the state government did not give land by July 2007 as promised.
All road works concerning Kochi?which is now the whirlpool of big infrastructure development, including Vallapadam ICT and Petronet LNG project?are a top priority, state works minister Mons Joseph told FE. But, the key bottleneck is land acquisition.
The state government?s only contribution to the port infrastructure has been the initiative in getting IWAI (Inland Water Authority of India) to develop the Kollam-Kottappuram inland waterway.
Although the Prime Minister’s Office has expressed anxiety at the time overrun, state industry minister Elamaram Karim had admitted that the April 2009 deadline for commissioning cannot be kept.
The sore spot for the district collector (Kochi) venturing to speed up the land acquisition is the compensation to those evicted from the project area. A revised compensation offer was not acceptable to Moolampilly village evictees.
Given the infiltration of suspected terrorist outfits at coastal belts like Kochi, the socio-economic wounds in the evictee population are too vulnerable to be ignored. This makes the tailoring of an acceptable compensation package very tricky.
The Kerala government cannot afford to look the other way for too long. Eyeing the Vallarpadam ICT, at least 30 upmarket logistic players have scheduled Kochi in their business plans for the coming years. In a concept paper, C Unnikrishnan, deputy secretary, Kochi Port Trust, points out that the project could generate at least Rs 8,000 crore industrial investment in Kochi.
The best option for the Kerala government is to immediately form a battery of negotiators, drawn from all stakeholders, including chambers of commerce in Kerala, Dubai Ports World and Kochi Port, to oil the parleys for an acceptable compensation package for the evictees. Too much are at stakes, if the land acquisition does not get cracking soon enough.