 "The view from the coast in Enayam. Over the past three years, the sea has advanced 150 feet into the village")
Flanked by the Arabian Sea on one side and verdant forests on the other, Enayam is an idyllic village near Kanyakumari. For generations, villagers have lived off the sea and land here, eking out a living by fishing and farming.
But over the past few months, they have been up in arms against a government project. “The project will be a great disaster for the people of this region and will wipe out coastal villages,” says George Robinson, a fisherman from the village.
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IN CLOSE PROXIMITY The distance between the three ports in south India |
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25kms
25O kms
His angst is directed at the Rs 27,000-crore Enayam International Container Trans-shipment Port which was cleared by the Centre earlier this month. First announced in the 1990s, it was a poll promise made by the Bharatiya Janata Party and the Cabinet approved it on July 6.
The port will be built in three phases and once it is fully ready in 2030, it will span cover 330 hectares. For those whose land will be acquired, the government has promised jobs and rehabilitation. But many villagers are not convinced.
Robinson, who is also the spokesperson for the Movement Against Enayam International Container Trans-shipment project, says the port is unlikely to create enough jobs to accommodate all the people displaced by it.
“Trans-shipment ports rely heavily on automation, so there won’t be many jobs created for everyone to be employed,” he says. According to him, 250,000 people will be affected by the port in one way or another.
Vanishing shores
What villagers are more anxious about, though, is the damage the port could do to their environment. Rani, a fisherwoman, whose house is perched at the edge of the beach, says the sea has been chewing away at the ground that her house sits on and part of it has already been consumed by it.
Since the construction of a harbour in nearby Thengapattanam about three years ago, the sea has advanced about 150 feet into the village and people are worried the port could accelerate the erosion of the beach. Environmental activists agree the port could damage the coast across a 68-km stretch from Kanyakumari to Enayam.
Apart from Enayam, the feasibility report for the port jointly prepared by TYPSA and The Boston Consulting Group picked three more locations: Colachel, Manavalakurichi and Kanyakumari. Although Kanyakumari has better road and rail connectivity than Enayam, it was overlooked in favour of the latter. Villagers say one of the reasons for not choosing Kanyakumari could be the high environmental impact of the port. They also allege the report has manipulated the population density of Enayam to show it is sparsely inhabited.
P Muthuraman, district president of BJP’s trader wing in Kanyakumari, however, rubbishes these claims and calls the opposition to the port politically motivated. “Today the district doesn’t have any industry. This project will give a major fillip to the economic development of the region,” he says.
The reason the government is keen on the port is easy to see. According to Union Minister of Shipping Nitin Gadkari, at present, 25 per cent of the cargo from India is trans-shipped to foreign shores, with Tamil Nadu alone accounting for half of this. He says the Enayam port will reduce the logistics cost for traders, who currently depend on Colombo or other ports for trans-shipment, and generate up to Rs 1,500 crore in additional revenue for Indian ports annually. India’s trans-shipment traffic currently accounts for 40 per cent of Colombo’s volumes.
The government also feels it could leverage the port’s strategic location to make India a trans-shipment hub for the East-West trade route between Southeast Asia, West Asia and Europe.
To improve its commercial viability, Enayam will not be reliant on just one type of cargo. Manish R Sharma, partner (capital projects & infrastructure), PwC, says the port’s commercial risk profile will be improved by its ability to not only handle trans-shipped cargo but also domestic containers.
Questions over feasibility
Yet doubts have been raised about its commercial viability, given that there already are two ports within 100 nautical miles of Enayam: Vizhinjam and Vallarpadam.
“Creating clusters of ports within a short radius would be unhealthy unless each port is driven by specific requirements that would not compete with each other,” says G Raghu Shankar, chairman of SICCI’s Logistics.
Others too say it doesn’t make any business sense. “Allowing two huge projects within 25 kms of each other cannot be justified,” says Ramachandran Kadannappally, minister of ports, Kerala.
So far, Vallarpadam has not been able to compete head-to-head with Colombo as the port calling cost for the Sri Lankan port is one-tenth of Vallarpadam. It handled 366,376 TEUs of cargo in 2015-16, of which trans-shipment containers were only 17,000 TEUs. Colombo, in contrast, handled around 2 million TEUs of cargo that either originated from or was bound for India.
Colombo has been reducing its tariff to attract traffic to deal with the excess capacity it has added over the years. “It can cut tariff because it has got its returns on investments but Indian ports cannot do that, considering they are greenfield projects,” says an industry expert.
He says only the Adani group-promoted Vizhinjam stands a fair chance against Colombo. The Adanis not only have the financial muscle to play on tariff, their port also does not come under the Tariff Authority for Major Ports regulation, unlike Vallarpadam and Enayam, allowing them to fix their own rates.
