The difference between shipping and defence ministries over land transfer for a container terminal at Diamond Harbour in Kolkata is set to intensify with the former shooting off a draft Cabinet note on the issue without the consent of the latter.

Kolkata Port Trust (KoPT) needs nearly 125 acre of land for creating the terminal on the Hooghly river, of which 43 hectare on the river front are in defence ministry?s control. However, the project is stuck as Garden Reach Shipbuilders & Engineers (GRSE), a ship-builder administered by defence ministry, wants to utilise the land for its own use and is against its release.

In the draft note, the shipping ministry has proposed to give a 43-acre plot of land at Majerhat to the defence ministry in place of latter?s land. The port had earlier considered offering two dry docks in Netaji Subhas dock to GRSE on long-term lease as they were mostly used by naval vessels.

?We have given 15 days time to defence ministry to raise objections to the proposal. In case no objections are raised, we will go forward and file a Cabinet note,? a senior official in the shipping ministry told FE asking not to be named.

The container terminal at Diamond Harbour is significant for KoPT as the entire harbour has a 7-10 metre draft with almost no siltation and hence does not need regular dredging. KoPT?s existing terminals have to undergo frequent dredging with the central government subsidy. In March this year, the Centre released nearly Rs 300 crore to KoPT for dredging work in 2009-10.

The ministry official said the terminal would facilitate a lower waiting time for ships with complete barge movement. Average turnaround time at the port has been increasing year-on-year. It was 5.47 days in 2009-10 against 4.6 days in the previous year. In August 2010, it was 4.74 days as compared to 4.59 a year ago.

The terminal is expected to cost more than Rs 1,500 crore for construction with four ship jetties and three barge jetties. The annual capacity of the terminal would be 1.6 million twenty-feet equivalent unit. KoPT has arranged for nearly 80 acre of land with West Bengal government, Directorate General of Lighthouse & Lightships and Indian Railways committing to hand over some of their land holdings.