Four-berth terminal to handle 18.33 million tonnes annually; ₹61-per-tonne royalty offered by Essar Ports under 30-year PPP concession
Kandla, October 21, 2026: Deendayal Port Authority (DPA), Kandla, has awarded the development of a ₹2,276.06-crore Multi-Purpose Cargo Terminal at Tuna Tekra to Essar Ports Limited, marking a major step towards expanding cargo-handling capacity and strengthening the port’s role in India’s international trade.
DPA issued the Letter of Award (LoA) to Essar Ports on October 21 following a global competitive bidding process in which the company emerged as the highest bidder, offering a royalty of ₹61 per tonne payable to the port authority. The terminal will be developed under the Public-Private Partnership (PPP) model on a Build-Operate-Transfer (BOT) basis, with a concession period of 30 years.
Shri Sushil Kumar Singh, IRSME, Chairman of DPA, formally handed over the LoA to Mr. V. Srinivasan, Operating Partner – Infrastructure Vertical, and Mr. Ashish Rajgarhia, Chief Executive Officer of Essar Ports, in the presence of senior officials from both organisations.
The proposed terminal will come up on the eastern side of the Mega Container Terminal being developed by DP World at Tuna Tekra under the PPP model. With a planned annual cargo-handling capacity of 18.33 million tonnes, the project is expected to significantly augment DPA’s multipurpose cargo-handling capabilities and support the growth of domestic and export-import (EXIM) trade.
The estimated project cost of ₹2,276.06 crore comprises an investment of ₹1,552.57 crore by Essar Ports as the concessionaire and ₹723.49 crore by DPA. The port authority will provide common-user infrastructure, including dredging of the access channel, berth pockets and turning circles, as well as a common approach road.
The terminal will feature four berths, each measuring 300 metres, providing a total berth length of 1,200 metres. Designed to accommodate Cape-size vessels of up to 170,000 deadweight tonnes (DWT), the facility will have a draft capability of up to 18 metres. Commercial operations are expected to commence by 2031.
The development is expected to ease congestion at DPA’s existing dry-cargo berths, which are reportedly operating at more than 90% berth occupancy against an indicated ideal level of 70%. The additional capacity and deep-draft infrastructure will enable more efficient cargo handling, facilitate the deployment of larger vessels and improve the overall productivity of port operations.
The use of larger vessels is also expected to support more economical shipping operations by improving vessel utilisation and potentially reducing freight and fuel costs. Improved connectivity with major road and rail networks will further facilitate cargo evacuation, strengthen multimodal logistics and enhance the competitiveness of Indian exports.
The project is expected to generate direct and indirect employment opportunities and stimulate economic activity across Kutch and Gujarat through the development of ancillary services, including logistics, warehousing and other port-related businesses. Royalty payments to DPA and wider economic activity associated with the terminal are also expected to contribute to public revenues and regional trade growth.
Environmental sustainability is another stated consideration in the project’s development. The terminal will be developed and operated in accordance with applicable environmental requirements and the Green Port Policy, with sustainable practices and green technologies intended to minimise its environmental footprint.
The award aligns with the Government of India’s focus on port-led development under the vision of Viksit Bharat. With major container and multipurpose cargo infrastructure planned at Tuna Tekra, DPA is seeking to strengthen Kandla’s position as a strategic gateway for global trade and improve logistics efficiency across its hinterland.
The Multi-Purpose Cargo Terminal is expected to play a significant role in meeting future cargo demand, improving maritime connectivity and supporting the long-term growth of India’s western maritime gateway.