VPA keen on developing Mulapeta into a mega port with investment of Rs.1500 crore

Visakhapatnam Port Authority (VPA), one among top five ports in the country owned by the Government of India, has proposed to play a big role in transforming Mulapeta Port, now under development by Andhra Pradesh Maritime Board (APMB), into a mega port.

VPA has sought transfer of 2,000 acres of salt land located adjacent to Mulapeta Port (erstwhile Bhavanapadu) in Srikakulam district so as to invest around Rs.1500 crore in developing a Special Economic Zone to give a fillip to port-led development. Mulapeta Port is located in Srikakulam district, bordering Visakhapatnam district and south coastal areas of Odisha providing a huge hinterland for export and import cargo.

Gopalpur Port, which has been acquired by Adani Ports and SEZ (APSEZ) from Orissa Stevedores Ltd (OSL) and its partners, is located very close to Mulapeta Port. APSEZ has also acquired Gangavaram Port in the city from DVS Raju-led consortium and other investors. AP Government stake in Gangavaram has also been sold to Adani Group.

VPA last year had written a letter to APMB expressing its willingness to invest 49% stake in Mulapeta Port, which did not get an encouraging response. The latest proposal may be considered by the State Government as it will save heavy interest liability of Rs.150 if it mops up funds and buys the salt lands for expansion of Mulapeta Port. The salt lands are under the control of the Salt Commissioner, an instrumentality of the Government of India.

An official connected with the VPA's latest proposal told Bizz Buzz that they have communicated their willingness for further developing Mulapeta Port making it very clear that the next step will depend on the response from the authorities concerned.

The work on Mulapeta Port commenced during the YSRCP Government with an investment of Rs.4,362 crore and a capacity of 23.5 million tonnes under the first phase. During TDP regime post-bifurcation, the erstwhile Bhavanapadu Port project was awarded to Adani Group for development at a cost of Rs.5,000 crore but the project proponent subsequently opted out of its investment plan after signing MoU..

At the BIMSTEC Ports Conclave, held here recently, Ministry of Shipping, Ports and Waterways Secretary T.K. Ramachandran had urged Visakhapatnam MP M. Sribharat, to use his good offices to convince the State Government for development of Mulapeta Port into a mega port on the lines of Vadhavan Port being built by Jawaharlal Nehru Port Authority (JNPA) near Dahanu in Maharashtra--an offshore port on an artificial island.with a target to make it one among top 10 ports in the world.

JNPA has picked up 74% equity leaving 26% Maharashtra Maritime Board. Both TDP and BJP are now part of the NDA coalition and Chief Minister N. Chandrababu Naidu maintains very good rapport with Prime Minister Narendra Modi and other key leaders of BJP. VPA, a premier port set up in 1933, will also be a stakeholder in the Dugarajapatnam Port near Nellore. The State Government has mooted development of Dugarajapatnam into a port and ship repair cluster with the support of the Central Government.

VPA had earlier mooted a satellite port at Mulakedu near Bheemunipatnam, where it owns the waterfront area. However, the proposal did not get clearance from the government. VPA had also proposed to develop Gangavaram into a joint venture with the involvement of RINL before it was allowed for development under PPP model.