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Kerala Govt to take a loan of Rs 400 crore to pay for Vizhinjam Port project
Mr.G.Chandrasekar 2023-02-15 14:36:50 Container Terminal News

Kerala Govt to take a loan of Rs 400 crore to pay for Vizhinjam Port project

With the financial crisis gripping the Kerala government, it has decided to take loan of Rs 400 crores from the HUDCO to pay Adani Ports Vizhinjam project for the construction of breakwaters. The payment is part of the agreement the state government had entered into with the Adani group for the construction of the Vizhinjam port.

The central government has released a sum of Rs eight hundred crores as viability gap funding for the project. Kerala will have to provide Adani Ports Rs 400 crore when 30 per cent of the breakwater is completed according to the agreement and they have been knocking on the doors of the government for a while

The state government has been caught in a debt trap and the financial position has been in tatters and hence they are unable to honor the commitment to the port builder. With time running out, the PinarayiVijayan government has now decided to take a loan of Rs 400 crore from HUDCO.

The Vizhinjam Port has been a dream project of successive governments and was finally cleared by the then OommenChandy government (2011-16).  Adani Ports was the lone bidder for the project.

The work began on December 5, 2015.

Mr. Gautam Adani had then announced that the first ship will berth there on September 1, 2018, in a record time of less than 1,000 days, but due to various reasons things went haywire. State Ports Minister Shri AhamedDevarkovilhas now said that the first ship will berth in March 2023 and the first phase of the port will be commissioned in 2023.

The project first stalled in 2017 after cyclone Ockhi hit the construction site and a portion of the constructed breakwater was washed away and since then the shortage of limestone, the most important raw material for the project, caused another delay.

The total cost of the port project is Rs 7,525 crore and the state government has contributed 500 acres of land.