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The transhipment port at Vizhinjam may not enjoy much flexibility in tariffs

The vessel related charges (VRC) collected from ships calling at the port – the other main source of revenue for a port operator – will be fixed, collected and retained by APSEZ.
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The international container transhipment port being developed at Vizhinjam, will not have the freedom to set rates for cargo related charges based on market forces, unlike the other private ports run by its developer APSEZ), mainly due to the viability gap funding (VGF) extended by the Centre and the Kerala government equally, documents show.

However, the vessel related charges (VRC) collected from ships calling at the port – the other main source of revenue for a port operator – will be fixed, collected and retained by APSEZ.

“All charges levied on and payable to the Concessionaire (Adani Vizhinjam Port Pvt Ltd) for a vessel using the access channel, entrance channel and the harbour shall be determined by the Concessionaire from time to time in accordance with applicable laws,” the concession agreement signed by Adani Vizhinjam Port Pvt Ltd, a unit of APSEZ, and the Kerala government said. In the first phase of the project, Vizhinjam Port will have a capacity to handle 1 million twenty-foot equivalent units (TEUs) from a berth length of 800 metres. Some 85 percent of the 1 million TEU’s capacity is expected to come from transhipment cargo with the balance 15 percent accounted for by gateway traffic (export-import cargo directly sent to destinations without the need for transhipment at other ports).

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