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INDIA's Public Investment Board (PIB) has given the green light to Mumbai Port Trust's plans to develop an offshore container terminal, after the project was delayed for more than two years over security concerns.
Mumbai Port is expected to issue a letter of intent soon to Gammon India-led consortium, which won the mandate to build the container terminal through a bidding process, reports The Business Standard.
"The PIB clearance was a must for this project as Mumbai Port is investing 30 per cent of the total project cost as part of creating related infrastructure. With the go-ahead from the government, Mumbai Port will be able to issue a letter to Gammon India by the month-end," a source close to the development was cited saying in the report.
The project calls for the development of two container berths with a total length of 700 metres. The container business contributes three per cent to Mumbai Port's business, but once the two phases of the container terminal are completed, the facility is expected to handle 1.2 million TEU annually.
Mumbai Port handled 1.3 million TEU in the last financial year, while the neighbouring Jawaharlal Nehru Port Trust (JNPT) handled three million TEU. However, JNPT is expected to face capacity constraints by 2016-17, with the maximum container capacity being 11.6 million TEU.
According to consultant KPMG, India's projected container traffic is 71.7 million TEU by 2025-26, with the Maharashtra region alone contributing 12.1 million TEU.
"Given the highly optimistic future outlook of container trade, Mumbai Port cannot afford to ignore this cargo as part of its future plans. The city's 15 million inhabitants provide a captive market of white goods, metal products, machinery, textiles and food commodities, which primarily move in container," KPMG said in a report.
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