Adani Infra (India) Ltd (AIIL) will be awarded a fixed price Engineering, Procurement and Construction (EPC) contract worth $1.753 billion (about Rs 16,059 crore) for the construction of the second—and final—phase of the Vizhinjam Port in Thiruvananthapuram, Kerala.
To be awarded by Adani Vizhinjam Port Pvt Ltd (AVPPL), a unit fully owned by its parent firm, Adani Ports and Special Economic Zone Ltd (APSEZ), this related party transaction (RPT) contract will be one of the largest of its kind in the port sector.
RPTs are transactions between firms belonging to the same or related parent companies.
Phase 2 of the Vizhinjam Port is expected to build on the "shared infrastructure of Phase 1, such as initial breakwater, access roads, boundary wall, container scanner, gate complex", as per an APSEZ notice seeking shareholders’ nod for the deal at a February 2 meeting.
Phase 2 development is expected to add 4.1 million TEUs of cargo handling capacity to the Vizhinjam Port—2.56 times the capacity of the port during Phase 1, which officially began in 2024.
Among the major additions to the port in Phase 2 is the construction of a 1,200-metre berth that can house Ultra Large Container Vessels (ULCVs), dredging and land reclamation operations amounting to 7.6 million cubic metres of sea space, a backup yard with 10,900 TGS and allied utilities.
Other additions of note include an advanced rail yard handling facility (which was not a part of Phase 1), enhancing automation across the board at the port, critical infrastructure, and green equipment.
This comes despite the Vizhinjam Port already being the most advanced and fully automated transshipment port in India.
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As for the breakwater expansion, the APSEZ notice pointed out that though only an additional 920m of breakwater was needed for Phase 2, the marginal cost per metre of land dredged for it would be much higher than that for Phase 1.
This is because the extra breakwater developed under Phase 2 will go 21m deep into the sea.
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The port is anticipated to achieve full capacity augmentation by 2028. Compliance testing will continue for almost a year after Phase 2 development is complete. As a result, the notice added that payments for the project were estimated to continue till FY 2030.