The Union Cabinet’s decision to approve the construction of a new port on Tamil Nadu’s west coast at Enayam near Colachel is obviously aimed at making good a poll promise of the Bharatiya Janata Party. The location of the facility so close to another “mega” container terminal, however, has invited doubts about its viability, even its necessity. 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. It is planned under the landlord model, where the State’s publicly owned Chennai Port Trust, the V.O. Chidambaranar Port Trust, and the Kamarajar Port will make the initial equity investment, build the breakwater, undertake dredging and enable road and rail connectivity, while private companies operate the berths and provide the equipment. 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.
Another concern is about the proximity to the Adani concession at Vizhinjam, leave alone the Vallarpadam facility off Kochi; 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. That 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. Whether the potential is realised ultimately hinges on several factors. These include commitment from the State and Central governments to promote industrial activity in the port’s hinterland; speedy, transparent and fair land acquisition; and provision of world-class road, rail and coastal shipping links to allow cargo to move rapidly in and out of the port.
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