Dubai World's default won't hit us: Kochi port

27 November 2009

Kochi, Nov 27: A debt default request by Dubai World will not affect the ongoing construction of the international container terminal near here, being funded by one of the subsidiaries of the Dubai firm, the Cochin Port Trust (CPT) said Friday.

Hit by mounting debts, the state-run holding firm of Dubai that manages several businesses of the emirate Wednesday asked creditors for an extension of six months for debt repayments.

DP World, a subsidiary of Dubai World, is funding the Rs.2,118-crore ($451-million) International Container Transshipment Terminal (ICTT) at Vallarpadam near here, which, according to CPT, is "fast nearing completion".

"This is news to me that Dubai World faces financial problems. Here, the work is progressing smoothly as there's no crisis for funding from DP World," CPT chairman N. Ramachandran told IANS.

The first phase of the terminal will be completed as per schedule and commissioned April 1 next year, Ramachandran said.

DP World signed the agreement with CPT in 2005 to develop the terminal.

The company is building the 1,800-metre long, 14.5-metre deep container berth, while the basic infrastructure like roads and railway lines will be built by CPT.

"The construction began in 2007 and till today work has gone well with no problems at all. According to initial estimates, the budget for the first phase is around Rs.1,500 crore, but it is likely to go up," Ramachandran said.

"The developer has informed us that the work for second and final phase will begin after the inauguration of the first phase, and they expect to complete it in two years."

ICTT, billed as the country's first global hub terminal, is expected to alter the development map of the state and attract huge investments, government officials said.

A series of ventures including a Rs.1,600-crore LNG terminal, a port-based special economic zone (Rs.1,510 crore) and an international ship repair complex (Rs.315 crore), is also coming up in the area along with the ICTT project.