Centre keen to develop Mulapeta as mega port in Andhra Pradesh
The Union government has shown a strong interest in the development of Mulapeta as a mega port in Andhra Pradesh’s Srikakulam district, with investments estimated at approximately ₹1,500 crore spearheaded by the Visakhapatnam Port Authority. This initiative is part of a broader effort by the Andhra Pradesh state government to construct new ports, drawing significant attention from multiple stakeholders.
Visakhapatnam Port Authority has formally reached out to the state government of Andhra Pradesh for consent to transform Mulapeta into a mega port, while simultaneously requesting the Central government to transfer around 2,000 acres of adjacent salt land. This land is intended for the creation of a Special Economic Zone or a port-based industrial hub.
In a notable event at Visakhapatnam Port, central officials emphasized the importance of developing Mulapeta on par with Maharashtra’s Vadhvan Port. This port development could help Andhra Pradesh benefit from reduced interest costs of around ₹150 crore annually on loans taken for the new port’s construction, which follows the engineering, procurement, and construction (EPC) model.
The strategic importance of Mulapeta Port is underscored by its proximity to the Srikakulam district. If developed, it presents an opportunity for the Visakhapatnam Port Authority to transfer a considerable amount of environmentally taxing cargo like iron ore and coal, thereby reducing pollution levels in Visakhapatnam city. “Strategically, this location offers significant advantages,” insiders noted. The authority anticipates that this move will significantly benefit its operations.
The first phase of Mulapeta Port, projected to cost ₹3,670 crore, is planned to encompass four berths, with three designated for general cargo and one dedicated to coal. The port aims to handle an annual capacity of 23.5 million tonnes of cargo.
Further plans for Mulapeta’s development include capitalizing on extensive tracts of peripheral salt land. The Union government currently owns this land, managed by the Salt Commissioner’s Organisation under the Department for Promotion of Industry and Internal Trade (DPIIT) of the Ministry of Commerce and Industry. The state Maritime Board is also interested in acquiring this land area, albeit at 50% of the government-guideline value or the circle rate.
Recent changes in the Union’s policies, from 2024 onwards, have paved the way for unused salt lands across India to be allocated for various purposes, including ports, industrial projects, and renewable energy implementations. The Central government entities can secure this land for nominal fees, providing Visakhapatnam Port Authority with an economical advantage in acquiring it at only ₹1. However, state administrations like Andhra Pradesh’s would need to procure it at the stipulated 50% rate of the guideline value.
For the Mulapeta project to flourish, extensive land reserves are crucial. A contribution of ₹1,500 crore for Mulapeta Port’s phase one would greatly enhance its feasibility if complemented by a nominally priced land acquisition. Observers suggest that such support could significantly boost the overall viability of the mega project.
Although progress on Mulapeta port’s development by Visakhapatnam Port Authority has seen delays, mainly due to the complexity of land transfer negotiations involving 2,000 acres, there is consensus that future resolution between the involved parties can streamline the process. The DPIIT has instructed critical stakeholders, including the Andhra Pradesh Maritime Board and the Ministry of Ports, Shipping and Waterways, to consolidate their proposals for acquiring the salt land.
In discussions potentially steering these developments, Chief Minister Naidu has conveyed intentions to weigh all available options before proceeding. This project is an integral part of a trio of ports financed independently by the Andhra Pradesh government, highlighting a larger vision aimed at enhancing the maritime capacity of the region.
Key to fulfilling this vision will be the deployment of a resourceful and skilled maritime board, facilitating seamless collaboration with critical entities such as the DPIIT, Visakhapatnam Port Authority, and national shipping and waterways ministries.
The Mulapeta port development reflects a momentum in India’s maritime industry, marking an era of expanding infrastructure and strategic resource management. If executed effectively, it will not only bolster local economic activity but could serve as a template for port development nationally.
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