Machilipatnam Port moves forward, finally
The Machilipatnam Port project in Andhra Pradesh is finally
moving forward. The foundation stone of the Rs 1,600-crore project was laid on
April 23 at the hands of Chief Minister Y.S. Rajashekhar Reddy, more than a year
after the concession agreement was signed with the private developer consortium
in February 2007. What is encouraging, however, is that the cost escalation
issue that had dogged the project for months is headed for an early resolution.
Speaking to Projectmonitor, Saksham Garu, Assistant Secretary, Ports Department,
Andhra Pradesh, said the state government would decide on the cost escalation
issue over the next 15 days. Public sector Water & Power Consultancy (India) Ltd
is expected to certify the cost escalation of around Rs 330 crore that is the
result of relocating the project from its old site Gogileru to Gilakadinne. The
state government is committed to meet the cost escalation, once certified, Garu
said. The project is expected to reach financial closure over the next 30-40
days, he observed.
Machilipatnam Port has been awarded to a consortium of SREI Infrastructure Ltd
(37 per cent), Maytas Infra (26 per cent), Nagarjuna Constructions Ltd (25 per
cent) and Sarat Chatterjee & Company (VSP) Pvt. Ltd (10 per cent). In phase-I,
the port with three berths will handle 15 million tonnes of cargo annually,
mainly coal imports for APGenco's Vijayawada thermal power station, and cement
plants in the Krishna belt. "It is a fully private port with no share of the
government in the port's revenue," Garu explained, adding that the state
government will earn part of the profits generated by the port company. Phase-I
will have a gestation period of three years. The port in its full scale is
envisaged to handle 35 million tonnes of cargo annually, through 12 berths.
"Maytas Infra is proud to be associated with Machilipatnam deepwater port that
will provide a strong impetus to the development activity in this region. The
project would be developed in three years, and we look forward to contributing
to the progress of Andhra Pradesh," Teja Raju, Vice Chairman, Maytas Infra Ltd,
said in a company statement. The project, located in Krishna district, will be
developed on BOOT basis under a 30-year concession period.
Relocation: Soon after Machilipatnam Port was awarded in February last
year, Andhra Pradesh government decided to relocate the project from Gogileru to
Gilakadinne. The new site is in the vicinity (4 km north) of the old
Machilipatnam Port that is lying unused since 1990s. The change in location was
inspired by demands of the local population that sought the transformation of
the traditional Machilipatnam Port, believed to be the oldest port in the state,
into a modern port city.
Machilipatnam Port progress augurs well for maritime development in Andhra
Pradesh. Two more private ports - Gangavaram and Krishnapatnam - are expected to
start operations later this year (see related story on section Transport).
[April 28-May 4, 2008]