Rs 4000 Crore Port-Linking Plan Kicked Off

Work on the government's Rs 4,000 crore port-connectivity project has commenced at two of the 12 major ports of the country, with the process of linking up the remaining ports expected to be kicked off by the year-end. The project aims at connecting all major ports to the nearest national highway to facilitate smoother cargo evacuation.

"Work has already started at the Kandla and Marmugao ports, while contracts for linking Haldia, Vishakapatnam and Jawaharlal Nehru Port Trust (JNPT) to their nearest highways will be awarded in the next few months," an official said.

Following this, roads connecting the Chennai, Paradip and Kochi ports to the highways would be given out for upgradation, while work on links to New Mangalore and Tuticorin port will be awarded by the end of the year, he said.

For executing the projects, the government has opted for the special purpose vehicle (SPVs) route, with equity participation from the National Highways Authority of India (NHAI) and the respective port trusts. The SPVs would leverage the equity to borrow funds from the market on a project recourse basis. Through this arrangement, debt will be serviced and repaid out of the revenue streams from the project in the form of tolls collected from the users.

The first of the projects taken up was connectivity to the Mormugao port, where the contractor, the Border Roads Organisation (BRO) has started work. The port trust has provided Rs 20 crore to set up a SPV for port highway link. Work has also commenced at the Kandla port road.

NHAI has finalised an SPV arrangement with Visakhapatnam Port Trust (VPT) on a 50-50 partnership basis to provide port connectivity. Similarly, for the road link to Jawaharlal Nehru Port Trust (JNPT) and Mumbai Ports, both the port trusts have agreed to invest Rs 40 crore to float a SPV for project execution.

NHAI is also in talks with Calcutta and Chennai port trusts for a road connectivity to Calcutta-Haldia and Chennai Ennore Ports through the SPV route.

The Vizag port connectivity to National Highway-5, which links Calcutta with Chennai. The NH-5 plays a significant role in cargo movement along India's east coast. NHAI is already working on developing the highway between Calcutta and Chennai into a four-lane highway under the Golden Quadrilateral project, part of the Rs 54,000 crore National Highways Development Project (NHDP).

More than 40 firms have responded to the pre-qualification tender floated by the Vizag Port Road Company, officials said.