The Ministry of Environment and Forests has granted environmental clearance to the Vizhinjam International Seaport, which began commercial operations on December 3, 2024, for the second and third phases of development of the port based on the recommendation of an Expert Appraisal Committee.

The environmental clearance will pave the way for setting up additional infrastructure facilities at the port concessionaire Adani Vizhinjam Ports Private Ltd. (AVPPL), which will invest around ₹10,000 crore as part of the expansion of the transshipment port. As part of the second and third phases of development, the container terminal will be expanded to 1,200 m in length, and the length of the breakwater will be increased by another 900 m.

Additionally, the container yard and related infrastructure will be developed. Other development works include construction of 1,220-m-long multipurpose berths, 250-m-long liquid berths (with breakwater), liquid cargo storage facilities, and the dredging of approximately 7.20 Mm³ of land covering an area of ​​77.17 hectares.

Increased capacity

With this, the State government will be able to complete the Vizhinjam seaport project ahead of schedule, said Port Minister V.N. Vasavan. Upon completion of the second and third phases, the port will see the container handling capacity increased to 30 lakh TEUs (twenty-foot equivalent units) from the 10 lakh TEUs in Phase I. Through the use of automated systems, the capacity of the port can be increased to 4.5 million TEUs containers per year.

The Minister also said that by 2028, the international port will become the container terminal with the highest installed capacity in South India. Earlier, the State government entered a supplementary agreement with the port concessionaire as part of ending the arbitration proceedings between the AVPPL and the State government over the five-year delay in the project, and advancing the deadline for the next phases of works to 2028.

However, a stalemate between the State and the Union government over the Viability Gap Fund (VGF) has been delaying a tripartite agreement to be signed by the State government, AVPPL, and the Centre. The premium sharing agreement is also part of the tripartite agreement. Signing the tripartite agreement is necessary to end the arbitration proceedings. The Centre which earlier agreed to provide its VGF share of ₹817.80 crore to the port concessionaire, is yet to make the payment after the Centre insisted that Kerala would have to repay the VGF share of the Centre, a point that Kerala vehemently refused.