Now it is official. Visakhapatnam Port Trust has put on hold its proposal to develop a satellite port at Mulakedu near the 17th century Dutch township of Bheemunipatnam.

Sources have told The Hindu that as the cargo projection at the new port, if built, is found to be not viable, the port management came to the conclusion that it is not advisable to take it up in the near future.

A challenge

The port is handling an annual cargo of 65 million tonnes. It is facing a challenge due to recession and diversion of cargo to rival ports in its neighbourhood.

The VPT has launched its mission for mechanisation late, for which it is paying a heavy price.

Post-2008, it took up vigorous campaign to salvage its image by focusing on capacity augmentation as well as mechanisation.

It is investing nearly Rs.13,000 crore on mechanisation, mostly under BOT mode.

VPT Chairman M.T. Krishna Babu, during the visit of Union Minister of State for Commerce and Industry Nirmala Sitharaman, said they would not take up work on the satellite port.

He, however, indicated that they would launch work on fishing harbour so as to augment requirements at the existing fishing jetty in the city. The satellite port was mooted over a decade ago to decongest traffic at the main port.

The relocation of fishing harbour to Mulakedu would have facilitated the port to develop stacking and other facilities over an area of 24 hectares.

The main port itself has the capacity to handle 80 million tonne cargo. Once the ongoing mechanisation/capacity augmentation projects are completed, the port is expected to raise its capacity to 120 million tonnes by 2016-17.

Two projects

Work on two main projects — extension of container terminal by Visakha Container Terminal at a cost of Rs.633 crore and mechanisation of Ore Handling Complex by Vadinar Oil Terminal Ltd of Essar Ports Ltd with an outlay of Rs.845 crore — are expected to commence shortly.

We will launch work on fishing harbour so as to augment requirements at the existing fishing jetty

M.T. Krishna Babu

VPT Chairman

Cargo projection at the new port, if built, is found to be not viable