Center approves Galathea Bay Transhipment Port, bidding to start soon

In a bid to take full advantage of the India’s large coastline and further increase the efficiency of the country’s supply chain ecosystem, New Delhi has cleared the plan to build a dedicated container transshipment terminal at the Galathea Bay of Great Nicobar Island of Andaman and Nicobar Islands, along the Bay of Bengal coastline. The said hub will be India’s contender against established South Asian hub ports like Colombo, Singapore and Port Klang, which dominate the subcontinent transshipment activity.

“Experts have long maintained that a strong economic case exists for enabling a transshipment hub in India that can attract Indian and regional transshipment traffic from the current hubs, save significant revenue loss, reduce logistics inefficiencies for Indian trade, reduce risks to the country’s export competitiveness and create an opportunity for India to become a large hub for Asia-Africa, Asia-US/Europe container traffic trade,” India’s Ministry of Shipping said in an announcement.

The transhipment hub would enable big ships to anchor and raise India’s share in maritime trade, create new job opportunities and save a lot of forex. Currently, a major chunk of India’s transshipped cargo is handled at the aforesaid ports. Indian ports can save USD 200-220 million each year on transshipment cargo. The Galathea Bay Transhipment Port will further enhance logistics infrastructure and increase economic activity on other Indian ports as well, thereby considerably boosting maritime’s share in the overall revenue.

Also Read: All about India’s first mega transshipment container port at Great Nicobar Islands

The project is estimated to cost about USD 5 billion and will be developed through the public-private-partnership (PPP) model. The first phase is targeted for completion in 2028 with a capacity of 4 million TEUs annually, which will go up to 16 million TEUs when fully ready.

The location of the Port was decided based on its proximity to the international shipping trade route, availability of natural water depth of over 20m and carrying capacity of transshipment cargo from all the ports in the proximity.

Expression of Interest (EOIs) are ready to be floated for a long term PPP concession of 30-50 years.

The Union Minister of State for Port and Shipping Shantanu Thakur recently paid a visit to Andaman and Nicobar Island and took a view of the development activities planned for the islanders with port-related infrastructure. According to reports, in January 2021, the National Board for Wildlife (NBWL), denotified the entire Galathea Bay Wildlife Sanctuary to remove environmental hurdles for the construction of a transhipment port.

“The PPP concessionaire shall have the flexibility to develop storage area, container handling equipment and other infrastructure based on concessionaire’s own market and business assessment subject to the minimum guaranteed traffic. The concessionaire shall be responsible for the provision(s) of port services and shall have the rights to levy, collect and retain charges from port users,” added the Ministry’s statement.

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