On the Vizhinjam Frenzy

Some facts and figures on the Opaque Adani bid

The frenzy surrounding the Vizhinjam Port has reached such a fever pitch in the past few days that all informed debate has been made impossible. Civil society activists, celebrities and the public have come out on the streets serving ultimatums to the political parties to award the project to Adani. Online campaigns have also been started calling for a boycott of the Aruvikkara by elections if the project is not approved immediately.

At this point, it has to be made clear that am not against the port project. The concern is regarding the way everyone is clamouring for the project without having any idea about the details of its execution, funding and revenue sharing. It would seem all that they want is a port here, whether the state gets the revenue from it is not even part of anyone’s discussions right now.

Here are some simple facts regarding the project, thanks to A.J.Vijayan (from a mailing list) and Harish Vasudevan (partly translated from the Malayalam document he put up — shared in the comments here).

Note by A.J. Vijayan on Adani and Vizhinjam Terminal:

“`Tomorrow (3 June) an all-party meeting is being called by Kerala Government to discuss on the proposal of Adani to acquire the proposed Vizhinjam Container Transhipment Terminal. I wish our political parties know the details of Adani proposal and its long-term implications?

According to the Request for Proposal (RFP) put forward by Government of Kerala, “the selection of bidder is based on the highest premium/lowest grant quoted”.
As everyone knows, there was only one bidder — Adani.
So, what are the premium offered and the lowest grant quoted by Adani?
According to official records now uploaded by Kerala government in the website, the premium (revenue share) offered is 0% for the first 15 years of operation and a mere 1% on 15th year and to increase it by 1% every year for the next 40 years. The grant requested by Adani is 40% (the maximum permissible by GoI) of Total Project Cost.

When the bid for Vallarpadam Container Transhipment Terminal at Cochin was called in the year 2004, there were many bidders. The highest premium offered was 33.3% by Dubai Ports World and the second offer was 10.1% by Punj-Lloyd. See the news in this link: http://articles.economictimes.indiatimes.com/2004-03-26/news/27384678_1_highest-bidder-international-container-terminal-services-p-o-ports

Adani who is offering no premium for Vizhinjam, had actually offered last year 37% premium for Ennore port in TN and won the bid also. See that news in this link:
http://www.thehindu.com/todays-paper/tp-national/tp-tamilnadu/adani-group-wins-ennore-terminal-project-bid/article5675608.ece

So is not Adani taking Kerala Government for a ride? Or is there a big underhand deal between Adani and Oommen Chandy with blessings of Modi! Remember O Rajagopal recently said, Kerala ministers are asking commission to Adani for Vizhinjam!
The period for which Adani will hold the port is 40 years extendable by 20 years. The maximum period any private operator holding any other ports in India is 30 years only!’”
AJ Vijayan

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Some more information shared in Harish Vaseudevan’s post-

“The Kerala Government has also apparently taken over the financial burden of building breakwaters (by breaking down some hills in the Western Ghats), to make things easier for Adaniji. This will cost the Government Rs.1463. This is not included in the Total Project Cost of Rs.4089, out of which the Government will provide a grant of 40 percent.

The Government’s law advisers claim that Adani’s bid cannot be called a “single bid” as two other companies had also purchased the bid documents, though they never proceeded with it. One of those two companies happen to be Essar Port, which is about to be taken our by Adani Ports. The other one is Srei group, which doesnot have much experience in building ports. These two were thus benamis for Adani, who just purchased the documents, to make it look as if it’s not a ‘single bid’.”

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Meanwhile, yesterday, the Union Shipping Minister Nitin Gadkari said that the Vizhinjam project will be put on hold and the Kolachal port project in neighbouring Tamil Nadu will be handed over to Adani if the political differences in the state over awarding the project to the Adani group is not resolved fast. And Tamil Nadu is apparently waiting to hand over any amount of land for the same purpose. Clearly, it’s all being played out for the sake of Adani, who accompanies Mr.Modi across the globe in his pleasureofficial trips and whose hotel bills are paid from the taxpayer’s money.

All this talk of Oommen Chandy that this is “NOW OR NEVER” is to mislead the public. Gadkari’s and Chandy’s words are part of the classic scare tactics to get support from the public by creating an impression that this is the only way we can ‘progress’. It’s an easy way to get the public to support a proposal, which is effectively looting their money. The UDF and the BJP today moved effectively to again tar the left as “vikasana virodhikal” aka anti-development brigade, for raising questions on the secrecy surrounding the Adani bid. The ones crying hoarse for the port should take some time to analyse the facts and figures of the bill and not fall for the empty propaganda of vested interests. What good is a port if all the income from it is going to fill Adani’s coffers, which grew by 48 percent in one year under the Modi regime? Why should the State spend so much money for him to mint money? These questions need to be asked and it’s impossible in this current climate of ‘anti-debatism’.