The Vizhinjam International Seaport, once fully operational, is set to be a financial lifeline for the State government, projecting an annual revenue of nearly Rs 400 crore. As the State grapples with a severe financial crisis, this revenue stream is a much-needed relief. According to the project agreement, the government will begin receiving dividends from the port only after its 15th year of operations. However, the immediate influx of tax revenue is a welcome bonus for the State.
The primary source of revenue for the government will be the Goods and Services Tax (GST) imposed on levies paid by ships, container handling charges, and bunkering services provided to vessels, with most services taxed at a rate of 18%. This tax revenue is shared equally by the Centre and the State. Additionally, the Integrated Goods and Services Tax (IGST) imposed on machinery and equipment imported through the port contributes significantly to the State’s revenue. For instance, the recent import of three cranes to the port generated Rs 30 crore in GST.
By 2027, when the port is fully operational, it will have the capacity to handle 30 lakh containers annually. This development is expected to attract the majority of vessels currently utilizing ports in Colombo, Dubai’s Jebel Ali, and Singapore, leading them to shift their operations to Vizhinjam. The seaport anticipates an annual income of Rs 2,500 crore.
The inauguration of the Vizhinjam International Seaport is a historic moment, marked by the arrival of the first cargo vessel, Zhen Hua. The official berthing ceremony is scheduled for 4 pm on Sunday, with the Union Minister for Ports, Sarbananda Sonowal, as the chief guest and Chief Minister Pinarayi Vijayan inaugurating the project. State Minister for Ports, Ahamed Devarkovil, will preside over the event.
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