In line with the new Liberalization policy adopted by the Government of Indian in the nineties, the Government of Puducherry (GoP) took steps to develop the minor port of Pondicherry into a deep water port with direct ship berthing facilities through private investment on Build, Operate and Transfer (BOT) basis.
The first such effort was during 1999; and the second during 2003.Both these efforts did not fructify as the private firms selected on those occasions failed to submit the stipulated security Deposit for undertaking the project.
The third effort was in 2005,Subsequent to identifying a private developer, the Port project got entangled in litigations from 2006 to 2010Subsequently in May 2013,the private developer went for Arbitration seeking a compensation of Rs.1,511 crore plus interest from the GoP.The Arbitral Tribunal constituted to decide on the Arbitration announced a "NIL" award on 18.07.2016.
Now that the litigations have ended, the GoP shall shortly sign a Memorandum of Understanding (MoU) with the Chennai Port Trust (ChPT) to recommence cargo handling operations at the existing minor port of Pondicherry. To start with,3 lakh tons of cargo per annum comprising of Container cargo and General cargo shall be handled and the cargo volumes shall be gradually ramped up.Also,there is a proposal to start passenger ferry service between the ports of Chennai and Karaikal through Pondicherry Port.
Towards expansion of Karaikal port,M/s Karaikal Port Private Limited,the private developer of Karaikal port has submitted a proposal to the GoP to establish a "LNG Terminal".
The above said development plans for the Pondicherry and Karaikal ports shall create direct/indirect employment opportunities and also generate revenue to the Government of Puducherry and the Government of India.