Landmark VGF Agreement Signed — State to Share 20% Port Revenue with Centre in a Win-Win Deal
Maritime News Thiruvananthapuram, India : The winds of change are blowing at Vizhinjam Port, as the Central Government officially signed a Viability Gap Funding (VGF) agreement worth ₹817.80 crore, marking a major breakthrough in one of India’s most strategically significant port projects.
Two Landmark Agreements Sealed
The first of two key agreements is a tripartite pact between the Central Government, Adani Vizhinjam Port Private Limited, and the project’s banking consortium, ensuring smooth fund flow and execution.
The second agreement, signed by Chief Secretary Sharada Muraleedharan in the presence of the Minister for Ports, sets a historic precedent — 20% of the revenue generated from Vizhinjam Port will be shared with the Central Government.
From Arbitration to Acceleration
The signing of the new agreements also signifies the end of prolonged arbitration proceedings, making way for faster completion of construction activities. Officials confirm that all formalities related to the first phase of Vizhinjam Port are now complete.
A Better Deal for the State
Compared to the earlier agreement, the new revenue-sharing model is expected to deliver significantly higher returns to the state government. This progressive approach ensures that the Centre’s financial assistance is matched by long-term mutual gains.
Gateway to Growth
As Vizhinjam gears up to become a maritime gateway on India’s southern coast, this agreement sets the stage for enhanced logistics, global trade connectivity, and a stronger blue economy. With construction gaining speed and cooperation at an all-time high, Vizhinjam Port is sailing toward a transformative future.
On behalf of the Kerala Government, Chief Secretary Sharada Muraleedharan signed the agreement in the presence of Minister for Ports V. N. Vasavan.
“A Historic Moment,” Says Minister V. N. Vasavan
Minister Vasavan called the VGF agreement a historic moment for Kerala. “We are progressing on a war footing to complete both road and rail connectivity to Vizhinjam. By 2028, we aim to have full-scale cargo movement capabilities,” he said.
He emphasized that once cargo traffic begins flowing seamlessly by land and sea, Vizhinjam will fulfill its intended vision. “Vizhinjam has already emerged as one of the most promising ports on the global map,” the minister added.
Top Officials Attend Signing Ceremony
The signing event was attended by senior officials including:
- Baldev Purusharth, Joint Secretary, Union Ministry of Finance
- Dr. A. Kaushigan, Special Secretary, Kerala Ports Department
- Divya S. Iyer, Managing Director, Vizhinjam International Seaport Ltd. (VISL)
- Pradeep Jayaraman, CEO, Adani Vizhinjam Port Pvt. Ltd. (AVPPL)
With the VGF agreement sealed, Kerala now moves one step closer to establishing Vizhinjam as a world-class transshipment hub. The new model is expected to not only streamline infrastructure development but also ensure shared economic gains between the state and the Centre.
