CPT wants Kerala to take up project

Kochi: The Cochin Port Trust (CPT), through its staff association, has expressed its desire to the Kerala state government to take over the Goshree project for the overall development of the region.

The poser has come in view of the financial difficulties of the state government, which reportedly is not in a position to stand back as a guarantor for the loan that the Goshree Island Development Authority (GIDA) had proposed to take from banks or a consortium for the completion of the construction of bridges from the Ernakulam mainland to the Vypeen Islands.

The staff association feels it will be viable if the entire project is handed over to the CPT, reserving the right to sell the reclaimed land at Marine Drive with the port. The association has called for a discussion at the appropriate level so that a favourable decision could be arrived at the earliest.

The Goshree project is envisaged to establish road links from the Ernakulam mainland to the thickly-populated Vypeen Island. The project comprises construction of three bridges, which together would connect Vypeen and the isolated islands like Vallarpadam and Bolghatty, to the mainland.

Since these bridges connect one island to another, the other islands in the Kochi backwaters will also get the benefit of connectivity. The total length of these bridges will be about 1,380 metres. Since the cost of these bridges could not be met through government funding, ways and means to make the project self-financing is thought of.

It was proposed to reclaim an area of about 25 ha (62 acres) from the backwaters. The sale proceeds of this land should pay for the project and this would make the project self-supporting. As per the proposal, 25 ha of land has been reclaimed at the northern tip of Marine Drive from where the connection from the mainland begins.

This area was selected for the reason that the reclaimed area would form an extension of the existing Marine Drive, deriving all its commercial advantages. The unit price of land will be high, reducing the total area required for reclamation. The total construction cost of the entire project, including construction of bridges and road network, was estimated to be around Rs 75 crore.

The land available through reclamation can be sold at the market price. Plots, after laying the network of road, will be available for sale at the end of three years from now. But the initial finance has to be mobilised from suitable sources.

This amount will accrue interest. Considering the financing cost of the projects as well, the total cost of the project at the end of three years from now has been estimated to be about Rs 115 crore. Out of the 25 ha of land reclaimed, the area available for sale is approximately 40 acres. Considering an optimistic value of Rs 4 lakh for every cent, the total sale proceeds from the land should amount to Rs 160 crore.

Now, the state governments main role for this project is to stand back as a guarantor for the banks or a consortium which funds the project and later on realise the cost plus interest by selling the projected area of about 40 acres out of the 62 acres already reclaimed.

There have been apprehensions at some quarters due to the delay on the part of the government to stand guarantor. There is also the ticklish issue of the credibility of the government. It is in this context that the staff association feels that if the port tried for a soft loan the banks or a consortium will respond favourably.

Association president P M Mohammed Haneef, who has already wrote a letter describing all these to Chief Minister A K Antony, says this fund can be even released from the CPTs reserve fund. In the light of these facts, and since the state government had already entrusted the implementation and execution of this particular project to the CPT and also because the port is an organisation having technical expertise with an operational surplus to the tune of Rs 30 crore, this is the time to reconsider the decisions already taken and to implement this Rs 75-crore project as a project of the CPT.

The main benefits that could be derived out of this project once the whole project is taken up by the port are: this would be a major breakthrough for the fulfilment of the proposed Container Transhipment Terminal at Vallarpadam; value-addition to the 400 acres of land which the port possesses at Vallarpadam; speedy implementation of the LNG-LPG terminal project proposed at Puthuvypeen; value-addition to the 600 acres of land (including the 110 acres of land handed over to the CPT by the state government), which the port is having at Puthuvypeen area; speedy implementation of the proposed bunkering terminal for which tenders have already been invited; and if the port is allowed to sell the reclaimed land at Ernakulam Marine Drive for funding this project, the ports financial position would improve or could cope without budgetary support.