Thiruvananthapuram: The Kerala government got a nasty shock on Friday when no investor showed interest in bidding for the much-hyped international container transshipment terminal at Vizhinjam, near the state capital.
The matter came to light when the deadline passed for submission of tenders for the project on Friday morning. The development has put the future of the proposed project in uncertainty. The state government extended the time for submission of tenders by one more month, following the no-show for the bidding.
Kerala minister for ports, K. Babu said the development was “a surprise” and that the government would inquire whether there was a conspiracy or some attempt to derail the project which led to no party showing interest in submitting tenders.
Initially five companies had shown interest in the project, but only three companies, namely Adani Ports, Essar Ports and Srei Infrastructure, had shown serious interest and purchased tender documents. Had at least one of them submitted a tender, the state government could have at least negotiated with the investor.
One of the advantages that Vizhinjam holds is that it is a natural port with a draft of nearly 20 metres, which will reduce the cost for the investor in dredging for depth. The port is also close to major international shipping routes.
The disinterest in the project is particularly bitter for the state government considering that even the federal government had promised financial support for the project. The federal government was to arrange for 20 per cent of the project cost, with the state government making a matching contribution, leaving the private investor to raise only the remaining amount.
The absence of any bidder for such a prestigious project is seen by industry circles as an image setback for the Congress-led state government. The United Democratic Front government had held a much-publicised ‘Emerging Kerala’ investors’ meet in 2012 to attract investment to the state, but the outcome of that meet has not been encouraging.
The performance of the existing major port in Kerala, the Kochi port where the operator is DP World, has also not met expectations so far.