Saturday, August 20, 2011

Vizhinjam - Doubting Thomases Listen Up!

The bid process for the $ 2 Billion Vizhinam deep-water port project in Trivandrum is nearing its close. The project's nodal agency, VISL, recently released key project reports which have many areas of concern from the perspective of any proponent of Vizhinjam. Some of the most glaring issues are discussed in the article, together with suggestions how the reports could have been made better and some longer-term proposals for the development of this mega-project!

Perhaps you may not have noticed it in the continuing avalanche of temple treasure, Team Anna and the threat of another global meltdown, but the last few days have seen Kerala's largest ever infrastructure project take two key steps forward. The first, of course, is the submission of bids by two entities, one being the Adani Group's Mundra Port and the other a consortium of the $ 3 Billion Indian conglomerate Welspun and Australian construction giant Leighton. One of these firms will now be selected as the master operator of the port (subject to them meeting all the tender guidelines) and potential as the EPC (Engineering Procurement Construction) contractor for Phase I. The second piece of news is that the agency entrusted with the development of the $ 2 Billion deep water port project, Vizhinjam International Seaport Limited, finally launched a decent website, albeit long AFTER the tender process was completed.

Excellent news, one should say, considering the travails that this landmark project has been through in the recent past (not to forget a small 60 year implementation delay!). The fact that the Adani Group has submitted a bid is possibly the most significant as their Mundra Port is already the biggest private port in India and is poised to become the nation's busiest port in the next 3 - 4 years. The Adani's also have a 4000 MW coal-fired power station in development in addition to the Ultra Mega Power Project (UMPP) being built by the Tata group at Mundra, and are the largest coal importers in India. The Group recently acquired the Abbot Point Coal Terminal in Australia for the trifling sum of $ 2 Billion. Mundra already has two container terminals, one operated by the Adani Group itself and the other by DP World, together handling well in excess of 1.5 Million TEUs a year and with a combined capacity approaching 3 Million TEU. One hopes that the Adani Group might have ambitions in both containers and coal at India's deepest port, Vizhinjam being even deeper and better located than Mundra. The second consortium seems to be more focused on the construction aspect of the project which could be worth over Rs 2000 Crores in Phase One alone, and would bring in a specialist port/terminal operator if awarded the tender (unless they already have one already onboard).

All well and good, but there are a few troubling issues as well, which have come to the fore with VISL belatedly posting on its website crucial documents related to the feasibility study of the port (Yes, those were completed a year ago but were finally posted, you guessed right, AFTER the bid process was over! Genius, huh?!). To put it as succinctly as possible, the consultants appointed at great cost to promote the project seem to have taken a less rigorous and far more pessimistic view in many areas, than even a layman like yours truly. This definitely needs some looking into, because these very reports could determine the success or failure, at least of this round of tendering. And hopefully, this won't end up being a post-mortem analysis. There were over 600 pages of reports to be read in all, including a market study, a technical options report and a preliminary project plan, all of them highly technical in nature. So what follows is the result of a quick review, by someone who's not a marine engineer by training, so do bear with me as I make my comments.

Where did all those containers go?

When the latest edition of the tender started, VISL started floating some traffic estimate numbers for the project. 2.8 Million TEUs in 2044, for example. Wait a second, 2044?? Why were the latest numbers less than half of what the winning bidder in the last round, Lanco, had estimated within a shorter time span and well below what the original project consultants L&T-Ramboll had put down? I was left wondering whether the current market research consultant, Drewery, had missed out a zero here or there. On closer examination of the market study, it seems there are several points of departure from what would be logical sound assumptions. Firstly, the estimate of Indian GDP growth seems pretty conservative, considering the fact that there is already a pronounced shift in economic power towards India and China. Even accounting for the current hiccups in the global economy, the outlook over the medium and long term should be far more robust than what the study predicts. This in turn, affects the growth rate of overall Indian container traffic, of which a portion will flow via Vizhinjam. Next, the report seems to underestimate the ability of a port with unbeatable draft and minimal operating costs to take traffic away from its competitors. Basically, little credit seems to be given to the way a highly dynamic market like container shipping operates.With significant sensitivity to shipping costs, containerized cargo tends to follow the least cost path and if Vizhinjam can offer equal facilities as competing ports such as Colombo and Dubai at a lower cost, container lines will naturally choose the port of total least cost.

At this juncture, the Market Study takes a very pessimistic view of how much traffic Vizhinjam can capture from Colombo, its main competitor, which currently handles about 40% of all container traffic to and from India. A rather circumspect traffic-cost analysis shows that Vizhinjam is at a $3/TEU disadvantage with respect to Colombo assuming existing tariffs (Pages 130 - 134). Not only is this margin a negligible 2% of the existing tariff at Colombo, it is clear that with significant advantages such as the landlord port model which allows initial capital costs to be spread out through Government debt support, minimal dredging requirements and exemption from the tariff constraints at major ports, Vizhinjam should be able to significantly under-cut Colombo in terms of handling costs. The report goes to make assumptions that Vizhinjam would be unable to attract cargo bound for West and North India (Page 176) since these would be delivered direct to the deep draft ports in Gujarat such as Pipavav and Mundra. To an extent this is correct since these are close to the industrial hinterland of North and Western India. However, when we consider the biggest container ships, with carrying capacities greater than 11,000 TEUs, they are unlikely to make more than one stop in a country. In this scenario, Vizhinjam allows them to offload containers in India with minimal deviation from the Suez - Malacca shipping route followed by these behemoths on their round trips from the US/Europe to East Asia. Thus, it is likely that at least some of this cargo will be transshipped at Vizhinjam. Furthermore, the study also harps about Colombo's distance advantage to ports on the Indian East Coast, which seems rather suspect when one factors in the savings in distance that will be brought about by the Sethusamudram shipping channel (Of course, assuming that the ghosts of Ram's mythical simian army don't stop it permanently!). Finally, Vizhinjam has the added advantage of geo-political safety as far as Indian container traffic is considered which no foreign port can guarantee (least of all Colombo, which happens to be in the same country where the Chinese are almost done building what will be a pseudo-Naval base!).

Despite all this, Drewery estimates that Vizhinjam will only be able to capture only about 12 - 15% of the total transshipment potential available to Vizhinjam and Colombo (Page 196), due to their superiority over other regional ports such as Tuticorin and Cochin. And this is after Vizhinjam offers sizable discounts to Colombo's tariff! One wonders why this should be so? If Vizhinjam is cheaper, is on the Indian mainland and has the same, if not better connectivity, to Indian ports, why should it not be able to draw a much greater share of transshipment cargo away from Colombo. The report makes some vague reference to the fact that Colombo has greater "hinterland" cargo than Vizhinjam and hence can create bigger parcel sizes for shipping lines. However, an examination of the tables given in the report (Pages 179 - 180) shows that Sri Lanka's own hinterland volume is less 5% - 10% of India's, which means that lines that choose to transship at Vizhinjam instead of Colombo would not lose a critical volume of cargo. Moreover, if Vizhinjam provides a lower cost option, there is no commercial reason why cargo from Sri Lanka should not be transshiped at Vizhinjam although Drewery very conveniently rules it out citing some unspecified "feeder costs".

Even if we take Drewery's report at its face-value, the transshipment volumes for South and East India - which Vizhinjam could most effectively target - is 5 Million TEU in 2015, 8.5 Million TEU in 2020 and 20 Million TEU in 2030. With an effective tariff structure, one can assume safely that Vizhinjam should be able to target 20% - 25% of this traffic, even if it cannot split the honors evenly with Colombo. This means that the projected transshipment traffic for Vizhinjam should be 1.0 - 1.3 Million TEUs in 2015, 1.7 - 2.2 Million TEUs in 2020 and 4 - 5 Million TEUs in 2030, which is much closer to the original L&T Ramboll/Lanco estimates.

At this juncture, one needs to call into question the veracity, intent and sincerity of the report by Drewery, which fails to be aggressive or bullish with its container volume estimates, which is the need of the day when a Billion dollar bid process is under way. Instead, it uses rather circumspect logic to generate a pessimistic estimate of the port's potential. This fact is made painfully evident, when one sees that the only first-hand data survey conducted for the study was in Cochin (Page 168), not among global shipping lines or at competing hubs such as Colombo or Singapore. Somehow, that doesn't sound quite reassuring. And no, the bad news doesn't end here.

And how about the rest of the port? 

Having read through the dismal figures about container traffic in the report, if any bidder does get to the rest of the cargo forecast, he or she would be at a loss to find precisely that, non-containerized cargo, in the report. If this report is to be believed, Vizhinjam is unlikely to ever see bulk cargo of any kind such as coal and petroleum, although it does offer up dribbles of cashew and timber as scant consolation. The report then goes on to deep-six (pardon the nautical pun!) ship repair and leaves some vague recommendations for the equally trumpeted cruise market. Despair not, let's take a second look at these areas.

Drewery starts off by predicting that Vizhinjam would be a non-starter as far as coal, one of the world's most voluminous bulk cargo items, is concerned (Page 212). Firstly, the report says that there are no thermal power plants, steel plants or cement plants in and around Trivandrum. Well, that doesn't exactly require an expensive consultant to discover, does it? And to make sure that no one asks an inconvenient question such as "What if we build a port based thermal power plant?", the report quashes any likelihood of a coal-fired power station by saying that plentiful natural gas from the LNG terminal in Ernakulam and the KG Basin would erase any need for coal. Unfortunately for the second assumption, there are a few inconvenient truths sticking out. First, coal continues to be cheaper than gas, as pointed out in this report by the International Energy Agency and which is the reason behind the Government of India going ahead with nine Ultra Mega Power Projects (UMPPs), all with capacities of 4000 MW or more and all fired by coal.Second, imported LNG is extra costly, and the LNG terminal at Ernakulam is already struggling to find customers. Thirdly, the KG basin gas is already in short supply, even if we choose to ignore current supply problems.The demand for energy in India is rapidly increasing. A recent report by KPMG states that power consumption in China is about 1800 KWh/person while in India it is only about 750 KWh/person (to say nothing of the 15,000 KWh/person in the US!). This means that even to reach a figure comparable to China, India would need to add about 100,000 MW of power generation capacity in the next few years. While some of this will be renewable, nuclear and gas-based power generation, it is evident that the bulk will have to come from coal-fired stations which account for over 70% of current installed capacity. Since Indian coal production is capacity constrained and Indian coal is of relatively poor quality, a significant portion of the new power demand would have to fueled with imported coal, which is one reason many of the UMPPs are located near deep-water ports like Mundra and Krishnapatanam. These allow for the import of vast amounts of coal in giant coal carriers with capacities exceeding 200,000 tons. Almost all of India's coal imports will come in from Australia, Indonesia and South Africa (now you understand why the Adanis bought that coal port we talked about in the beginning!) The last inconvenient fact for the market report is that it is easier to transmit electricity than transport coal, which means it is best to generate the power as close to the coal supply as possible and then dispatch the electricity via the National Grid to wherever it is needed. Hmmm, so which is the closest deep-water port in India to the mines of Australia and Indonesia? No prizes for guessing, it is Vizhinjam with over 18 m of natural depth and located on the Southern tip of the subcontinent. 


Considering all this, the potential to set up a UMPP somewhere in the vicinity of Vizhinjam doesn't sound like an impossibility (the key issue would be finding the 850 - 1500 acres of land needed for one of these giants) and indeed as Kerala, despite being a coastal State, has as of yet not applied for a UMPP, this is a very viable proposition. A UMPP in Kerala would incur the least cost for import of coal as it is closest to the coal sources and this could lead to a cost advantage for the project with power possibly being evacuated through the 440 KV line of the Power Grid Corporation of India Ltd (PGCIL) already ready at Trivandrum, which is meant to draw power from the Koodankulam Nuclear Power Plant. A UMPP would need the import of over 12 - 15 Million Tons of coal annually via Vizhinjam. While it can be argued that this is a very aggressive scenario considering the sensitivity around the environment in Kerala as well as the relative scarcity of land, it should have been included in the report as a possibility for a potential bidder to consider, as Mundra Port may already have done on their own (or so we may hope!). After all, a near-permanent solution to Kerala's power woes and a Rs 20,000 Crore investment in the power project would be a powerful incentive to cobble together the land necessary for the project in a rural corner of Trivandrum district.

Next, the report moves on to petroleum traffic, namely crude oil and petroleum products (Page 233). Once again, it makes the stellar observation that there is no oil refinery in Trivandrum. Duh?! It continues to exclude any potential for future oil refining operations or even for product import by saying that existing ports such as the ones at Tuticorin and Ernakulam will continue to  handle such cargo. Well, to me, it seems like Vizhinjam has all of Southern Kerala and at least 3 major districts of TN as a direct hinterland where it has distance advantages over its neighboring ports. Moreover, it will have tariff advantages being outside the restrictions of the major ports' tariff regime. Here lies a clear case for import of petro products such as petrol, diesel and kerosene currently shipped via truck or train. Moreover, it is folly to rule out a refinery in the region, because there are two clear potential areas of demand for such a project. The first, and the simplest, is the vast hinterland of Southern Kerala and most of the Southern half of TN, which is currently served by refineries in Chennai and Ernakulam. A new refinery that uses Vizhinjam as a crude import terminal will be able to meet the growing demand of this region, which includes rapidly growing cities such as Trivandrum, Madurai, Trichy, Tirunelveli, Tuticorin and Kollam, at lower costs than the existing refineries. Secondly, the field of contract refining/export-oriented refining is gaining traction world-wide as consuming regions such the US, East Asia and Europe impose strict restrictions which make setting up new refineries there very difficult and open the way for strategically located refineries to process crude from sources such as the Middle-East and then send the products by tanker to the end markets. This is a successful business model by Reliance's world-beating Jamnagar complex as well as by Singapore, the tiny island being the world's third largest refining hub after Houston and Rotterdam. A sizeable refinery (a 600,000 barrel per day unit would need about 500 acres of land, about the same as the Technocity project has) could be set up somewhere in Trivandrum district or even in the neighboring districts of Tirunelveli or Kanyakumari where land is in relative abundance. Attached to the only port in India capable of handling VLCC/ULCC traffic WITHIN its basin (as opposed to Single Point Moorings far out at sea), a port that lies right on the world's crude oil artery, the refinery would have significant cost advantages and a major export market in South and East Asia, as well as further out, even to the US West Coast, in addition to the extensive hinterland as mentioned above. Again, this is an optimistic scenario but one which needs to be mentioned in a unbiased report so that prospective bidders can do their own numbers on its viability. Drewery's report makes no mention of this, the only saving grace being that it mentions that a major international firm had evinced interest in setting up a petroleum storage terminal in Vizhinjam and that a major oil company was interested in establishing bunkering operations.
One of Singapore's many refineries. Image:

Now, given the fact that about a third of all the world's shipping traffic passes by just ten nautical miles or less from Vizhinjam, on the Suez/Gulf - Malacca route, one would be forgiven for thinking that a world-class ship repair/building yard would be an attractive proposition at Vizhinjam. In fact, there have been a lot of noise made in the recent past about a Central Government initiative for a shipyard at Poovar and for the public-sector Cochin Shipyard Limited to set up a world-class yard, for the first time, at Vizhinjam. 

Drewery's report mentions all of Vizhinjam's advantages - location on the shipping channel, deep draft and then plays up its apparent disadvantages - competition from Dubai and Singapore, lack of trained manpower, humid climate, "labour problems" in Kerala (huh?, weren't these guys supposed to be on our side?!) and lack of international air connectivity to bring in spares. It doesn't take an Ivy League degree to understand that there is no dearth of trained and experienced manpower in Kerala and India because I would wager quite a bit on the fact that the majority of workers at the yards in Dubai and Singapore are Indians! Humid climate....well, it's the same climate as one sees in Singapore, day for day. Labor troubles, let me not even get into that. Trivandrum Airport already has 3 dedicated freighters a week with connections to the Mid-East hubs and Hong Kong and this can easily be stepped up if equipment needs to be imported for the ship yard. It suffices to say that India has significant advantages in labor availability and supporting manufacturing facilities (ranging from world-class steel plants to engineering companies) which could make it a world-leader in ship repair/building just as the Koreans and the Chinese have become in very short order, and this is evident from the plethora of private yards which have come up, including SKIL's yard at Pipavav and L&T's complex near Chennai. The report spends six or seven pages (Pages 291-297) on this subject but abruptly stops without a conclusion or recommendation. And there is more to come on this!

There has been a lot of talk about the potential for cruise operations at Vizhinjam not least of all because it happens to be located in the district which attracts the most foreign tourists in Kerala and is located close to a shipping route used by over 300 cruise ships every year. Unfortunately, the report pays lip-service to the subject and leaves nothing other than a table (Page 290) listing some figures for traffic estimates (which looks quite arbitrary, changing by as much as 50% in some years!) as well as some disheartening anecdotes of failure among cruise lines in India, most recently the collapse of Louis Cruises' venture at Ernakulam. It's a pity that such a high-potential area (more for the tourist industry than the port itself) has been given scant attention, perhaps the report makers should have been sent a copy of the comprehensive report on the subject prepared by my better half, a few years ago!

The report concludes with an analysis of the prospective tariffs and revenue streams from the port, which is again quite conservative. For example, it assumes that Vizhinjam will forever have to offer a hefty discount to Colombo to survive, which is counter-intuitive because once significant traffic is established at Vizhinjam, there is no further need to be sub-par with Colombo or any other port. At this point, the port can afford to charge tariffs that are revenue-neutral. Of course, the report makes no mention of any significant non-container revenue stream as we had discussed previously, whereas it would have been prudent to include this in a "High Revenue" scenario at the end.

A "clean and green" port......Huh?

The Preliminary Project Report for the Vizhinjam deep-water port has been prepared by Royal Haskoning and it must be said that they have done a fine job, at least as far as the technical aspects of port design are concerned. That said, there are a few surprises in there as well. After an exhaustive review of the site conditions (Pages 1-23), the report comes up with a set of vision key words for the project, based on the Drewery report
  • Green and Clean
  • Efficient
  • Competitive
  • Attractive for Tourism
  • "God's Own Port"
One is left wondering whether this is the project report of a $ 2 Billion deep-water port or a tourist resort! I am an environmentalist at heart and I love words like "green and clean", but that has different connotations in different contexts, a clean port is not the same as a clean operating theater, is it? We don't want a dirty, polluting port at Vizhinjam but we certainly do want a viable one! 

And there is certainly a major question raised about the viability of the project when the report proceeds to axe three key areas of potential operations - coal import, petroleum and ship repair based on the need to have a "Clean and Green Port"! (Pages 26-27). A port is a port is a port, gentlemen. While we can deploy technology such as dust suppression equipment, oil containment booms, effluent treatment, use of electric power instead of diesel wherever possible and noise reduction, a port will never be as pretty or as quiet as a beach resort. However, most of this noise and visual impact (cranes, containers and hulking ships) will be contained within the port's boundaries. The port itself is located in natural bay and is not even visible from up and down the coast. The only reason that Haskoning quotes to keep the "non-green" operations out is to make the port "tourist friendly". Cruise operations are glamorous but typically add little direct economic value and sacrificing major revenue earners such as coal import and ship repair/building for this is economic suicide. Moreover, major cruise terminals such as the ones in Singapore and Port Klang (both of which I have personally been to) are located right in the middle of major ports which handle all types of cargo. As long as a world-class cruise terminal is available to let fussy cruise passengers disembark and embark in air-conditioned comfort, they are not much bothered by whether containers or coal is being unloaded close by.

Star Cruise Terminal at Port Klang Photo: Tan Tiong Kee at Panaramio
Consequently, these areas of operation are excluded from the port master plan which seems rather truncated from earlier versions prepared by L&T Ramboll (Pages 51-52), while the development of the 2nd and 3rd phases has also been slowed down over a longer total development time-line. I wonder how much of this will finally be left up to the winning port operator, because it will be the ultimate judge of the traffic potential of the port. Because the project is currently being pursued in the "Landlord" model where the Government is responsible for almost all the civil work - breakwaters, quay, backup area and connectivity - and the operator is only responsible for the terminal infrastructure and operations, one wonders whether the expansion of the port will be determined by the operator or the Government or both?
This is a key area of uncertainty left by the third report, by the project's main consultant, the International Finance Corporation (IFC). In its report (Page 62), IFC states that in the Landlord model the Government would be responsible for the long-term master plan of the port as well as for executing all civil work through EPC contractors, which includes even the later phases of expansion of the project. Later on, the report states that GoK should consult the winning operator about the final design (Page 76). This will be critical in preventing issues at a later stage. GoK has appointed one of the world's leading engineering and PMC firms, AECOM, as the project's EPC consultant and this a  step in the right direction, although it is not clear how the final design would be developed from the work done by Royal Haskoning - whether AECOM would do this through its own in-house design team or a sub-consultant or a separate contract would be handed out by GoK. Operators will have the right to take up the 2nd and 3rd phases of the terminal, but will not be able to seek financial support from GoK as they can for Phase 1. This can be read into to mean that the operator can trigger the 2nd and 3rd phases of expansion whenever it feels that a traffic threshold has been attained and GoK would then be bound to issue the requisite EPC contracts. There is also an interesting clause by which the operator can take over the lucrative EPC contract if it bids and is within 15% of the lowest bidder, and then agrees to match the bid. This gives it a leg-up in the case of the EPC bid which is estimated to be worth over Rs 2000 Crores for Phase I alone, and may be an additional reason why a contractor like Welspun Leighton has been so keen on bidding.
A key final concern is that the RFQ/RFP process does not call for the operator consortium to have an actual terminal operator as a member at the time of the bid, only a commitment to bring in a qualified operator within a fixed time period of being awarded the bid. Although Mundra Port or Leighton Welspun, whoever wins, should be able to secure a capable operator, it would have been a much more robust proposition if the container terminal operator had been made a mandatory part of the consortium. As can be seen from the market report, the strength of the terminal operator will be a crucial determinant in the success of the project, at least early on, as it will need to have strong linkages with one or more major lines to wrest them away from Colombo. A operator-line combination like AP Moller Terminals, a sister concern of the world's largest shipping company, AP Moller Maersk, would have been ideal. However, APMT already operates terminals in Colombo and Mundra, and may not be committed to the project. There are alternatives such as Singapore's PSA or like Hyundai and MSC which also have their own lines. In the current scenario, GoK has little control over the capability of the terminal operator as long as it meets the minimum qualification criteria which are not very daunting.
All in all, the combination of reports submitted by IFC and its consultants seem to underplay the potential of Vizhinjam. None of these reports were challenged by IFC or VISL before being adopted. Perhaps VISL doesn't have the expertise to do so, but isn't that their job? These reports could have and would have been challenged by any citizen who had a few hours of time to spend in analyzing them, even without the benefit of years of maritime experience. Unfortunately, despite one of VISL's bosses over the last few years personally proclaiming to me that all reports would be published on VISL's website as soon as they were available, this eventually happened well after the final bids were received! If I was given to believing in conspiracies, which I generally am not, it wouldn't be very far fetched to wonder whether the reports were spiked to scare all interested parties off or to clear the field in favor of one or more parties. At best, they seem like rushed-up jobs (even ignoring glaring mistakes like Balaramapuram being called "Balrampur" in one place and Trivandrum's top industry being identified as "handlooms" and Ernakulam's as "IT" when the former contributes 75% of Kerala's IT exports) which are very conservative in nature and fail to make any effort to capture the real potential of the Vizhinjam project and hence fall far short in their intended purpose of attracting investors.

Proponents of the report may argue that it is best to err on the side of caution but I say that to be over-conservative, at a stage where the project is trying to attract investment in a globally competitive industry, is a very risky strategy indeed. A project report should talk about the upside as much as it cautions about the possible downsides. Vizhinjam has been and will be an aspirational project. If people like the former rulers of Travancore, Sri M.V. Raghavan and Sri. M. Vijayakumar had not dared to dream of a deep-water container transshipment terminal where today only a fishing harbor exists, we would never have come this far. By not daring to push the boundaries of Vizhinjam's potential, I fear that we may now have put up yet another speed-breaker for a project which has had to survive numerous rounds of sabotage by vested interests near and afar.
Little wonder then that out of 12 qualified bidders, only 2 put in bids. One hopes that one of these two will take Vizhinjam from being a sleepy fishing hamlet to one of the region's busiest ports. If not, this looks like a mighty poor investment of the Crores invested in the services of these international consultants and yet another resounding slap in the face of the practice of having career civil servants, instead of qualified industry professionals, run multi-Billion dollar infrastructure projects.
Fingers crossed!


  1. About Coal, there are some hiccups and Indonesian govt is coming up with some stricter regulations.,20110906-354747,uk.html
    Indian power producers don't take Australian coal because the transportation costs are really really high. Power tariffs can't be increased too high, which will affect the customers. And, now there some talks about sourcing from South Africa.

    For me, it's not a Kochi vs TVM or a south vs. north game. The lobbyists who vie for the short term gains don't know how much losses they are going to inflict on future generations of this country by deterring projects like VISL. The current Cabotage act that deters international transhipment at Kochi is an example of how this country can be run at it worst with age old favouritism and control.

    I'm from Kochi. I love Kochi. But it's not about which place or region one's love should decide the development of this nation. VISL has to become a reality. Hope it turns into a reality.

  2. Egg-cellent article. You should think of building some decent road infrastructure before you have those container trucks on the road. By the way, research and blabber get along very well.

  3. Interesting and impressive comment, Ajay. I think you underestimate the challenge of acquiring the quantity of land needed for a UMPP or even a shipyard (500 acres is literally inconceivable at Vizhinjam), but a lot of what you say makes eminent sense. And now that I am a Director of VISL, I shall pursue this at every available opportunity!

  4. @ Manu - Appreciate your comments, Vizhinjam is the ideal gateway port for coal imports from Australia and South Africa, so the issues in Indonesia make no difference to its proposition. Hopefully, the Cabotage Act's restrictions will be lifted soon, although there have been several articles saying that there is no shortage of domestic shipping capacity for Vallarpadam as of now. Perhaps, its troubles are more fundamental in nature. Fingers crossed, anyhow.

    @ Dr Tharoor - Thanks for your feedback and support. Believe me, it is quite inspirational to hear from someone of your stature and status, especially in view of your direct involvement with VISL. There are plenty of maritime experts amongst the citizens of Trivandrum and it may be worth a shot to set up an advisory panel of informed and interested citizens to help expedite the project. I hope you will take the lead in this as well.

  5. Hi Ajay
    Just a small addition, AP Moller Maersk also operates the Pipavav Port in Gujarat.

    I wouldnt wish for any UMPPs in trivandrum... From construction to operation they wreak havoc on the health of the people living near by.

    Thanks for the informative analysis.


Thanks for your comment, I will take a look at it and put it up at the earliest.