Private sector players seek incentives for ₹48,000 crore Great Nicobar Port

To build the ₹48,000 crore greenfield International Container Transshipment Port in Galathea Bay, at Great Nicobar Island, private sector players have sought a slew of incentives including Hybrid Annuity public private partnership (PPP) model under which the central government through its arms hold 70% stake, while the private player gets 30% during the construction stage.

“Given the due consideration of high investments and strategic nature of the project, it is appropriate to have the construction of marine works by authority which will increase the cash flow to concessioner as well as provide them with construction support,” suggestions from the private sector representatives reviewed by ET, said.

With nearly 75% of India’s transshipped cargo handled at ports outside India, this project is significant for the nation. At present, Colombo, Singapore, and Klang handle more than 85% of this cargo with Colombo Port alone handling 45 percent. Once the Galathea projects comes about it can help the Indian ports save $200-220 million each year on transshipment cargo.

In January 2023, the Centre, through the Shyama Prasad Mookherjee Port, Kolkata, in association with Andaman and Nicobar Islands Integrated Development Corporation Limited, invited Expression of Interest to develop the International Container Transshipment Port in Galathea Bay. Ten participants responded and took part in consultations. The participants were Adani Ports and Special Economic Zone, JSW Infra, Royal Boskalis Westminster, Rail Vikas Nigam, Container Corporation of India and Essar Ports, among others.

The participants expect the government to be ready to bear the cost of construction while operation is to be left to the concessionaire. To kick start the project, and reduce the financial burden on the bidder, the government should be committed to invest major initial cost, said one of the interested companies.

Another demand is to have a Right of First Refusal for development of any other terminal for handing of similar cargo or other cargo at the proposed port. A tax holiday has also been sought to lower the port tariff.

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