Union Cabinet’s decision to approve the construction of a new port on Tamil Nadu’s west coast at Enayam near Colachel.
Why Enayam is chosen?
Envisaged as a gateway container trans-shipment hub for cargo moving to and from India and along one of the world’s major shipping lanes connecting the Suez Canal to east Asia, Enayam is being projected as a competitor to Colombo.
Chosen for its natural water depth of about 20 m, and proximity to the east-west international shipping lane, the proposed port will be located about 40 km south of Vizhinjam in Kerala, where the Adani Group is developing a trans-shipment container terminal.
Arguments against the project
1. It is alleged that the decision is aimed at making good a poll promise of the Bharatiya Janata Party.
2. Enayam port is expected to cost about Rs.6,500 crore in the first phase, when container handling capacity is projected at 1.5 million TEUs. The proposed initial funding for the Rs.27,000- crore project raises questions over the facility’s feasibility given the capital requirement and the ability of the existing major ports to find the money.
3. The location of the facility so close to another “mega” container terminal, however, has invited doubts about its viability, even its necessity. Enayam is in close proximity to the Adani concession at Vizhinjam, whether two major container trans-shipment hubs can be justified in terms of the potential traffic they aim to attract is debatable.
With global trade still becalmed by the worldwide economic slowdown, the outlook for container shipping demand remains cloudy.
Arguments in support of the project
Enayam will be designed to berth the latest and largest Triple-E class container vessels, however, does indicate that the Ministry’s planners have a strategic vision and are counting on a future rebound in world trade.
According to the preliminary study for this port, trans-shipment traffic at the terminal is projected to surge fourfold from 700,000 TEUs in 2020 to 2.8 million TEUs by 2025, and touch 3.9 million TEUs by 2030.
Certain Pre-requisites for success of Port
1. These include commitment from the State and Central governments to promote industrial activity in the port’s hinterland;
2. Speedy, transparent and fair land acquisition; and
3. Provision of world-class road, rail and coastal shipping links to allow cargo to move rapidly in and out of the port.