VOC Port Authority scraps ₹7,056 crore second tender for building mega container terminal

The V O Chidambaranar (VOC) Port Authority has once again scrapped its ambitious plan to build a mega container terminal in the outer harbour of the southern port, after failing to attract any private bidders. This marks the second such cancellation in 18 months for the ₹7,055.95-crore project, which was intended to add 4 million twenty-foot equivalent units (TEUs) of capacity to the port’s infrastructure.

The tender, which was initially floated in February 2024 and re-issued in December the same year, faced multiple deadline extensions but failed to generate sufficient interest from the private sector. During a roadshow in Mumbai in March 2024 and subsequent pre-bid meetings, potential investors raised serious concerns over the financial and technical feasibility of the project.

One of the main issues flagged by interested parties was the “unrealistic” cost estimates for key civil works such as dredging and breakwater construction. These estimates were prepared with technical support from the National Technology Center for Ports, Waterways and Coasts (NTCPWC) under the Indian Institute of Technology Madras (IITM). However, bidders argued that the projections did not align with prevailing market conditions and posed significant investment risks.

The cancellation of the tender deals a blow to India’s ongoing efforts to modernize its port infrastructure and decongest overburdened hubs like JNPT and Mundra. The VOC Port, strategically located in Tamil Nadu, has the potential to emerge as a major transshipment and logistics hub in southern India. However, its progress has been hampered by challenges in attracting private capital and structuring commercially viable projects.