Tajpur port project: Adani awaits LoA, Bengal seeks clarity on MHA nod

The Adani Group is waiting for a letter of award (LoA) from the West Bengal government to go ahead with the Tajpur greenfield port development, even as the state is seeking clarity on a conditional approval received from the Union Home Ministry.

West Bengal Industry Minister, Shashi Panja, said that there was a provisional letter of intent (LoI), which was given to APSEZ (Adani Ports and Special Economic Zone) last year.

“Then certain clearances need to be taken from the Union government from four departments – Ministry of Shipping, Home Affairs, Defence and External Affairs. The Ministry of Home Affairs has given a conditional security clearance and has made certain observations.”

“Those are something which the entities involved – the state government and the group (APSEZ) – are looking into. There are certain clarifications that have been sought vis-à-vis these observations and so the communications are on,” she said.

Sources in the Adani Group said that it was waiting for the letter of award (LoA) from the government. For the concession agreement, all clearances have to be in place, indicated state government sources.

On November 9, during an earnings call with analysts, Karan Adani, Chief Executive Officer and Whole-time Director, APSEZ, had said, “On West Bengal Tajpur port, we are still waiting for a letter of award, LOA. We have received the letter of intent. We are waiting for the LOA to come.”

“Once we get it, it will be 18 to 24 months before we start any construction over there since we have to go through the EC, environment clearance, as well as groundwork over there,” he had further said.

Panja’s comments clearing the air about the project came days after West Bengal Chief Minister Mamata Banerjee sprung a surprise at the Bengal Global Business Summit (BGBS) last week, when she told investors, “(The) proposed deep sea port at Tajpur – that is ready, you can participate in the tender. This will attract an investment of about $3 billion, which means Rs 25,000 crore.”

As key officials in the administration were caught unawares, speculation ran rife about the project, touted as ‘game-changing’ for West Bengal. That the Adanis were absent at the investor summit only added fuel to it.

Panja, however, said that they were invited.

The Importance of Deep Sea Port

On October 12, 2022, Karan Adani was handed over the letter of intent (LoI) for the deep sea project at Bijaya Sammilani, an annual meet-and-greet post-Durga Puja.

The port - to be developed on a design, build, operate and transfer model - was expected to have a draft of 12.1 metres with an 18 km channel. With a tidal support of 3.9 metres, it was to have a net 16 metres draft facility enabling large cape size vessels of 1 lakh DWT.

The project was extremely important for West Bengal to resolve the low draft issue at existing port facilities of Kolkata and Haldia, a bureaucrat said.

The overall size of the project was pegged to be Rs 25,000 crore, of which the port would entail an investment of Rs 15,000 crore and the related port-led infrastructure development another Rs 10,000 crore. For Bengal, which is looking to double exports by the next decade, a greenfield port would provide quick access to the world markets.