The state-run Cochin Port Authority (CPA) plans to deepen the 12-km-long navigation channel of the International Container Transhipment Terminal (ICTT) at Vallarpadam — operated by DP World — from 14.5 metres to 16 metres, at an estimated cost of ₹600–700 crore, in a bid to enhance the terminal’s competitiveness amid growing pressure from the newly opened Vizhinjam Port nearby.
According to a senior official at the Ministry of Ports, Shipping and Waterways, CPA has submitted a proposal seeking Union government funding for the capital dredging project. To complement the deepening initiative, DP World has been asked to invest around ₹1,800 crore to extend the existing berth by 350 metres and install new equipment, enabling the handling of larger 16-metre-draft vessels.
Both parties are expected to sign a Memorandum of Understanding (MoU) on October 29 to formalize the channel deepening and berth expansion plans.
The revival of the long-pending dredging proposal—shelved two years ago—comes in response to the operationalization of Adani Ports’ Vizhinjam Transhipment Terminal, which offers deeper draft and more flexible marine tariffs.
While the capital dredging cost of ₹600–700 crore is proposed to be fully funded by the Centre, the port authority is seeking an assurance from DP World to either commit a minimum guaranteed throughput (MGT) of 1 million TEUs annually or share the incremental maintenance dredging cost of ₹25–30 crore per year.
However, DP World has opposed the proposal, arguing that it is already committing ₹1,800 crore for the berth expansion and that both parties are sharing the investment risk. The Dubai-based operator has also expressed concerns over recovering its investment within the remaining 13–14 years of the 30-year concession, suggesting that such large-scale investment would be viable only if the concession period is extended.
Despite the 14.5-metre draft, vessel calls at ICTT have remained modest—only 13 ships requiring 14.5 metres of draft called in the last four years. To control costs, CPA has been following a need-based dredging approach, which has helped reduce expenses but created a backlog of 13 million cubic metres of silt to be removed during the deepening process.
The ICTT handled 8.34 lakh TEUs in FY25, one of its best performances, boosted by ad hoc transhipment calls amid the Russia–Ukraine conflict. However, volumes have since dropped to around 7.5 lakh TEUs this fiscal due to reduced ad hoc calls and the diversion of traffic to Vizhinjam.
CPA Chairman B. Kasiviswanathan confirmed that DP World has agreed to invest in extending the berth, though he declined to share specifics about MGT commitments.
Port industry experts say the development has reignited discussions on extending PPP concession periods at major ports beyond 30 years, as older terminals look to undertake fresh rounds of capacity expansion.
“The government must take a serious policy call on extending existing PPP concessions to attract additional investments,” a ministry source observed.
The Detailed Project Report (DPR) for the channel deepening was prepared by Voyants Solutions Pvt Ltd.
