AP Govt Clears Port, Mega Shipbuilding Cluster at Dugarajapatnam

• Andhra Pradesh clears a greenfield port and mega shipbuilding cluster at Dugarajapatnam via a 50:50 SPV with Visakhapatnam Port Authority
• 2,000 acres to be acquired, making AP the first state to approve such a cluster under the new scheme
• Centre to fund common infrastructure; cluster capacity planned at about 1.2 million GT annually

The government of Andhra Pradesh has given a go-ahead to the creation of a greenfield port along with a large shipbuilding cluster at Dugarajapatnam in the Tirupati district under the Shipbuilding Development Scheme (SbDS) which has been approved by the Union Cabinet.

The project will be implemented through a new company created equally by the AP Maritime Board and the Union Government-controlled Visakhapatnam Port Authority.

According to an order from the state’s Infrastructure & Investment (Ports) Department, the N Chandrababu Naidu-led government has permitted the Andhra Pradesh Maritime Board to buy approximately 2000 acres of land for the project.

The land will be given to the SPV as the state government’s equity contribution. The Maritime Board has also been authorized to start the process of selecting a shipyard partner to create the mega shipbuilding cluster under the SbDS framework.

Also Read: India-New Zealand FTA to Boost Jobs and Trade: PM Luxon

Andhra Pradesh has, through its decision, become the pioneering state to greenlight a massive greenfield shipbuilding cluster, just after the Ministry of Ports, Shipping, and Waterways released comprehensive guidelines on the same day.

Extensions of the proposed cluster will consist of approximately 2 km of waterfront and a land parcel of 2,000 acres, which will be divided among shipyard facilities and the supporting industries, infrastructure, and common services.

It is anticipated that each cluster will comprise one or more large shipyards with a combined capacity of about 1.2 million gross tons per year, including at least one main shipyard of 0.5 million GT capacity over the next decade. Once the SPV has been established, it can request the National Shipbuilding Mission's in-principle approval via the Directorate General of Shipping.

The government will give full financial support for the required common infrastructure under the SbDS while the anchor shipyards will fund their specific facilities and operations based on commercial considerations.