Nicobar port has no ‘strategic goals’, Finance Ministry body said in 2024

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A view of Great Nicobar Island, in Nicobar. Photo credit: AICC

The Public Investment Board (PIB), a Finance Ministry body that appraises large public investments, had on August 2024 termed the proposed International Container Transhipment Port (ICTP) at Galathea Bay in Great Nicobar Island as lacking in “strategic objectives”.

At the August meeting, it had advised the Ministry of Ports, Shipping and Waterways (MoPSW) to include a strategic case into its proposal. A little over a year later, the same project was formally notified as a “strategic project” by the Ministry of Defence, according to records of a March 2026 meeting viewed by The Hindu.

The “strategic” nature of the proposed ₹81,000-crore Great Nicobar Project, which consists of the ICTP, a township, airport, a gas-powered power plant and a tourism zone, has been the Centre’s excuse, since at least 2022, for not making public the contents of a report by a High Powered Committee (HPC) on the cumulative environmental impact of the project. It has also denied Right To Information requests on environmental clearances for the project on the same grounds.

The proposal, sponsored by the MoPSW with the Kamarajar Port Limited (KPL) in Chennai as the implementing agency, sought PPPAC clearance to build the port in two phases and crucially, approval for ₹12,230 crore as Viability Gap Funding (VGF) to make the commercially marginal project bankable. VGF is a one-time grant given to support infrastructure projects that are economically justified but fall short of commercial (financial) viability.

The PPPAC cleared the proposal “unanimously” though it refused the VGF, recommending instead that the MoPSW use its internal budget for the same. Earlier this week, Congress MP Jairam Ramesh wrote to Environment Minister Bhupender Yadav that “...the narrative on the Great Nicobar Island Project has suddenly shifted… faced with incontrovertible evidence of its hugely adverse ecological impacts, the Union Government is now emphasizing its