The Modi government is going to initiate the process to build an ambitious container transshipment hub at Galathea Bay in the Great Nicobar Island with the aim of bringing down India’s dependence on overseas ports.

Shyama Prasad Mookerjee Port (SMP), formerly Calcutta Port Trust, will float an expression of interest at the end of the month seeking suggestions from port operators and shipping lines as it looks to test the waters before going ahead with the plan.

The multi-year port development project will call for investment of Rs 17,000 crore, the bulk of which is expected from the private sector. SMP wants to complete the first phase by 2028.

“The government of India is planning to take up a composite development involving port, airport and township at Galathea Bay in Great Nicobar Island at a cost of Rs 40,000 crore.”

“This is a matter of strategic importance to the nation, aiming to reduce our dependence on the ports of Colombo and Singapore for container movement,” P.L. Haranadh, chairman of SMP, said.

The development plan has been prepared by the Niti Aayog.

At present, smaller ships carrying containers sail to these ports where the cargo is loaded to bigger ships for movement to a final destination. If a transshipment hub comes at Galathea Bay, which is located close to Indira Point, India’s southernmost tip, the containers will be handled within the country’s waters and jurisdiction and save on logistic cost.

Minister of state for shipping, Shantanu Thakur, who hails from Bengal, visited the location last week to take stock. SMP is entrusted with the development of the port at the Bay.

Strategically positioned between Colombo and Singapore, Galathea Bay has natural draught of 20 metres, ideal for large ships. SMP is looking at handling 4.3 million tonnes cargo by 2028.

A senior official of the port later explained that the port would finalise the final tender document after taking suggestions from the port developers and shipping lines.

The global shipping trade is highly consolidated with five companies dominating the business. A transhipment hub will be successful if the shipping lines make regular calls at the port.

The port officials and the minister were meeting the industry stakeholders on Thursday in Calcutta. Later, minister Thakur informed a multi-modal inland water terminal built in Haldia would be formally inaugurated by Prime Minister Modi on Thursday from Varanasi.