Vadhavan Port Project

Source-This post on Vadhavan Port Project has been created based on the article “MEGA PORT OF CALL” published in “Business Standard” on 22 June 2024.

UPSC Syllabus-GS Paper-3- Infrastructure: Energy, Ports, Roads, Airports, Railways etc.

Context– The Vadhavan port project, recently approved by the Union Cabinet, marks a significant development for India’s maritime infrastructure. Located in Dahanu, Maharashtra, it will be the country’s first major port since JNPA, commissioned in 1989, and will address longstanding challenges faced by Indian ports due to geographical limitations.

In India, no new major government-run ports have been established in over 50 years, although the private sector port at Mundra was commissioned 25 years ago. Presently, there are initiatives to upgrade Deendayal and Paradip ports into mega ports, with plans also set for a mega port at Galathea Bay in the Nicobar Islands.

What are the challenges posed by Indian Coastline?

1) Large oil tankers and container ships cannot approach India’s coastline due to its sprawling beaches, forcing them to unload their cargo primarily at Colombo. Occasionally, they conduct mid-sea transfers of goods closer to Indian ports.

2) Currently, most of India’s major ports offer depths ranging from 14 to 14.5 meters do not have adequate depth to accommodate large vessels effectively. Capesize ships, which are ultra-large carriers typically carrying around 170,000 deadweight tonnes (DWT), require a minimum water depth of at least 18 meters to safely navigate and dock at ports.

Read more- Port Infrastructure: Issues and Challenges

What is the significance of Vadhavan Port Project? 

1) Economic Significance: – Mega port status: A mega port is a huge maritime facility that manages large amounts of cargo and can handle very large ships like Capesize vessels. These ports handle at least 300 million metric tonnes of cargo per year and are crucial hubs for global trade and shipping. It is going to be the first Indian port to begin as a true mega port (300+ MMTPA capacity). Its economic advantages are-

a) Lower freight costs per unit with larger volumes.

b) Ability to handle a wider range of goods than smaller ports, which are typically focused on dry or bulk cargo like JNPA and Mundra.

c) Capacity to host diverse suppliers, industrial complexes, and logistics firms, promoting economies of agglomeration.

d) Competition among operators, leading to reduced handling charges.

e) Feeding smaller ports in a hub-and-spoke model, where the mega port manages global maritime traffic and distributes cargo to smaller ports.

2) Trade implications:

1. Potential to handle projected sea-based EXIM trade of $1.6-2 trillion by 2030.
2. Could reduce dependence on foreign ports for transshipment.

3) Strategic importance: It is crucial node for IMEEC (India-Middle East-Europe Economic Corridor) and INSTC (International North-South Transport Corridor).

What are some challenges and considerations?

Infrastructure requirements:

1. Extensive gantries, yard management capabilities, storage facilities.
2. Inland connectivity network.
3. Labor and capital for construction.

2) Environmental concern- An earlier proposal in 1998 was turned down because of environmental concerns. The current project needed to conduct 18 studies on environmental impact assessments.

Question for practice

What is the significance of Vadhavan Port Project?