India’s biggest container port, Jawaharlal Nehru Port Trust (JNPT) has finally got the green signal from the government of India this week for setting up India’s first port based multi-product special economic zone (SEZ) to come up in a major port. Spread over an area of 400 hectares of land, which has already been developed, the SEZ is set to take shape at a rapid pace.
Giving details about the SEZ the chairman of JNPT, L. Radhakrishnan stated, “Half the area will be for the processing industry and the other half for setting up supporting logistic units, housing, commercial complexes, due diligence and all that. Investment could be around $ 889 million but will not be on the public private partnership model so far the common route for development in the port sector in India. In fact the government has asked us to create a special model for setting up the SEZ at our port. This will be sent to the planning commission and we expect to commence operations by March 2010. We will complete all necessary arrangement ourselves and involve the private parties for the development soon.”
The SEZ will be inside the port as in the case of Jebel Ali and other similar ports abroad. The entire land has already been developed and ready for construction. The roads have already been constructed, arrangements for water supply and power distribution has been made, etc.
“We are in the process of appointing four consultants to undertake the various functions,” stated Mr Radhakrishnan. “These four consultants will be for preparing the feasibility studies; another for preparing the detailed project report. A special consultant will be entrusted with the actual supervision of the work of the entire project - since I don’t wish to involve our port engineers for this and the fourth for EPC related work. In a couple of months we expect to get things moving.”
JNPT is also in the process of undertaking capital dredging work to enhance the draft of the port to 14 meters for which it is set to raise $ 333.3 million through a tax free bond issue.
The money will fund the first phase of a $ 1.3 billion dredging project required to increase the draft of the common approach channel for Mumbai harbor and JNPT. “We can issue infra bonds of up to $ 1.1 billion and we will be raising $ 333.3 million before March,” informed Mr Radhakrishnan. “JNPT is undertaking dredging in two-phases which will increase the draft initially to 14 meters and then to 17 meters from the present 11 meters.”
Five bids have already been received by the JNPT for the first phase of the dredging and work for this is expected to start by November. According to the Chairman the first phase of dredging is expected to be completed in two years.