The Tamil Nadu Government has given the go ahead for developing Colachel as a major port and the project is likely to start in December, according to Mr T.R. Baalu, Union Minister for Shipping, Road and Transport.

Addressing a press conference here today, he said the State Government has given the `no objection certificate' for developing Colachel, a minor port in South Tamil Nadu. It needs to notify this under the Indian Ports Act to alienate land.

"By next December, we should lay the foundation stone for the port," he said.

It may be recalled the Sethusamudram Corporation Ltd recently invited bids from consultancy companies to prepare a detailed project report to develop a container transhipment hub at Colachel. The port is close to the international shipping route. Steamers of around 15,000 tonnes can anchor at the port, which is now managed by the Tamil Nadu Maritime Board.

RITES Ltd, a consultancy organisation, in its "Port Vision 2020" report identified Colachel as a suitable port for a container transhipment hub. In 1998, the Tamil Nadu Government prepared a detailed feasibility report, which was updated in 2000 by the Malaysian Government through the Construction Industry Development Board, Malaysia, for a greenfield port costing Rs 2,000 crore.

According to the State Government's Policy Note for 2006-2007, the interest shown by the Malaysian Government did not materialise for want of suitable financial arrangements by them. Considering the potential and the viability of the project, the Chief Minister, Mr M. Karunanidhi, has taken up with the Prime Minister, Dr Manmohan Singh, the issue of developing the transhipment hub.