Essar Ports wins Kandla multi-purpose cargo terminal at Rs 61 per tonne royalty

Deendayal Port Authority (DPA), the major port at Kandla on India's western coast, has formally issued a Letter of Award to Essar Ports Limited. The letter was issued on October 21, 2026. Under it, a state-of-the-art greenfield multi-purpose cargo terminal will be built at Tuna Tekra in Gujarat.

The project will run on a build-operate-transfer basis under the public-private partnership (PPP) model, with a concession period of 30 years. In the global competitive bidding, Essar Ports Limited quoted the highest royalty, Rs 61 per tonne payable to DPA, and won the contract on that basis. The terminal will come up east of DPA's mega container terminal at Tuna Tekra, which DP World is developing under the PPP model.

On the occasion, DPA Chairman Sushil Kumar Singh (IRSME) handed over the Letter of Award to V. Srinivasan, Operating Partner, Infrastructure Vertical, and Chief Executive Officer Ashish Rajgarhia of Essar Ports. Several senior officials of Deendayal Port Authority and Essar Ports Limited were also present.

The project is being seen in the light of Prime Minister Narendra Modi's vision of "Viksit Bharat" and the push for port-led economic growth. It has been described as highly important for strengthening India's maritime infrastructure, cutting logistics costs and boosting import-export business.

The proposed mega greenfield terminal has an annual cargo handling capacity of 18.33 million tonnes. The estimated project cost is Rs 2,276.06 crore. Essar Ports, as the concessionaire, will invest Rs 1,552.57 crore, while DPA will invest Rs 723.49 crore. DPA will provide common-use facilities such as dredging of the access channel, berth pockets and turning circles, along with approach roads.

The terminal will have four berths of 300 metres each, a total length of 1,200 metres. It will be able to handle Capesize vessels of up to 170,000 DWT and will have a draft of up to 18 metres. Commercial operations are expected to begin by 2031.

The terminal will be developed and operated in line with the Government of India's Green Port Policy and in compliance with applicable environmental norms. This includes the use of sustainable technology during construction and operation.

DPA's existing dry cargo berths currently operate at more than 90 per cent utilisation. The project is expected to bring this down to the ideal level of 70 per cent. The use of larger vessels will lower cargo transport and fuel costs and make Indian exports more competitive. The project is said to create significant direct and indirect employment, and to bring major relief to logistics, warehousing and related services in Kutch and across Gujarat.