According to some media reports, central government plans to develop two major ports, one each in Andhra Pradesh and West Bengal, through special purpose vehicle (SPV)-based model.
The central government may contribute Rs 5,000 crore as equity for the two projects. Reports indicate that the central government may contribute 74 percent of the total project cost, while the respective state governments may provide 26 percent of the cost.
While the government identified Sagar island for the West Bengal port project, the site for the Andhra Pradesh project is not determined. Some reports suggest that the most likely site may be Durgarajapatnam in Andhra Pradesh.
These two ports would add to the existing 12 major ports in the country, which are under the direct control of the central government.
The central government’s plan to adopt SPV-based model would be in deviation from the trust based model, mandated by Major Port Trust Act, 1963.
The total cost of both the projects would be about Rs 7,500 crore. Of this, Sagar port project would cost around Rs 5,500 crore as there has to be a rail link connecting the port from the island. That link only will involve an investment of about Rs 3,000 crore.
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