Trivandrum: The deepwater container transhipment project proposed to be set up at Vizhinjam, near here, has fallen under the shadow of uncertainty.

The consortium led by Hyderabad-based Lanco Kondapalli Power Limited on Wednesday wrote to the State government saying that it was revoking its offer of taking up the Rs.5,300-crore project.

Lanco cited uncertainty over when it could start work on the project as the reason for backing out. It said the possibility of further legal battles (over the tender process) would make all planning impossible, a senior official told The Hindu.

Lanco was awarded the project on build-operate-transfer basis in May last year through global tender. A consortium led by Mumbai-based Zoom Developers, which too had participated in the bidding, went to court challenging its disqualification during the appraisal of its technical bid.

The case moved from the Kerala High Court to the Supreme Court consuming valuable time. The Supreme Court directed the State government to subject the bid of the Zoom consortium to a fresh evaluation. This was done last week, but the Zoom consortium failed to make the grade a second time.

The Lanco consortium’s decision to back out comes against the background of reports that Zoom might once again approach the court.

Putting the project for a re-tender is one option the State government is examining. However, the government is not sure whether this is the right time to do so.

With the world now going through an economic recession, there is uncertainty over how international shipping business will shape up in the short-term and mid-term and this can also be a reason why Lanco has backed out, the official said.

Source: The Hindu