The State government has invited the Adani Group for discussions on how to take the Vizhinjam seaport project ahead in the face of the protracted agitation spearheaded by the Latin archdiocese, Thiruvananthapuram.
Earlier, the Adani Vizhinjam Port Pvt. Ltd. (AVPPL), the multi-port operator tasked with the execution of the ambitious project, demanded the State to compensate a loss of around ₹78.70 crore it incurred on account of the long-drawn strike.
The issue has then snowballed into a controversy with Vizhinjam International Seaport Ltd. (VISL), the State government company which oversees the project, requesting the State government to recoup the loss from protesters in the line of High Court directive that loss incurred by the State due to the protest of political parties should be recovered from the protesters themselves. The Latin archdiocese has questioned the move by asking the State to compensate the loss suffered by the fishermen due to the port work.
After the letter by the AVPPL, which stated that it has suffered a loss of ₹1.5 crore daily during the period of strike, Port Minister Ahamed Devarkovil has invited the AVPPL for a discussion on October 13 as the company has reportedly communicated to the State government that it would miss the deadline for the first phase of commissioning of the port owing to the strike.
Though the State government has not taken any formal decision in favour of Adani Group, the State is not against the proposal to extend the deadline for the project, according to sources.
In fact, the project was to be commissioned in 2019. As per the concession agreement signed between the port developer and the State government, the latter can levy liquidated damages for each day of delay in completing the project three months after the deadline fixed by the agreement. The damages to be paid to the State will come around Rs 12 lakh daily and Rs 3.60 crore monthly.
After it missed the 2019 deadline, the contractor company invoked natural calamities like two back-to-back floods, cyclones including Ockhi, ban on quarrying, and COVID-19 as force majeure (FM) — an event that is beyond the control of the parties and renders contractual performance impossible — to seek extension in the deadline to 2024.
Though the company had then listed 17 issues as major reasons for the delay in works when it approached the arbitration tribunal to avoid paying compensation to the State government, the State has not accepted their claims and admitted only a loss of 34 days during the COVID-19 lockdown period. The concessionaire was also told to commission the first phase in 2023 itself.
According to a senior government official, the loss statement submitted by the AVPLL is arbitrary. Still, the company can complete the work by 2023 December if there is no further obstruction to the port works, but it is the responsibility of the State to ensure it.
