Adani Group to enjoy operational rights of Vizhinjam Port for a total of 65 years

THIRUVANANTHAPURAM : With the Kerala government’s decision to extend the construction time period by another five years, the Adani Group will now enjoy the operational rights over the Vizhinjam Port for a total of 65 years. Initially granted rights for 40 years, the group secured an additional 20 years due to their commitment to funding the second and third phases of development at the port. On top of this, the CPM-led government granted another five years as compensation for the challenges faced during the port construction, owing to various natural disasters.

Hence, the Adani Group is slated to have the port’s operational rights for 65 years, which will be handed over to VISL only in 2075. Looking back, the works of the Vizhinjam Port which had begun in 2015 was supposed to be completed in December 2019. As per the initial agreement, the Adani Ports was supposed to hand over the operations to VISL (Vizhinjam International Seaport Ltd) in 2055.

According to the PPP norms in the country, the private partner enjoys the operational rights for 30 years, but in the case of Vizhinjam, it had already become 40 years back then. The UDF government that was in power when the developments were happening was heavily criticised for the extended time period.

As per the latest information, VISL will start receiving profit shares from 2034, starting from 1 percent. This will eventually rise up to 25 percent.

The Adani group will invest a total of Rs 20,000 crores for the second, third and fourth phase of development works at the Vizhinjam port.

The state government agreed to withdraw the arbitration procedures after the Adani Group agreed to complete the second and third phase of developmental works of the port by 2028.