Vizhinjam Port Concession Agreement
“We observed, based on the projected cash accounts established by the consultants hired by VISL (Vizhinjam International Seaport Ltd), that the dealership would recoup their J2.454 investments until the eleventh year of COD, that is, until 2030,” the report says. According to the report, aspects of the concession agreement, such as the extension of the concession period and the development of commercial real estate, have brought considerable benefits to Adani at the expense of the State. The Adani Group`s excess benefit in extending the concession period alone was estimated at 29,000 balances, even though there was no reasonable benefit to the State. Despite the Kerala government`s funding of 67 per cent of the project, the CAG found that “the government`s interests were not adequately protected during the development of the concession contract.” It concluded that “the technical and financial estimates made by the external consultants were not verified with due diligence, resulting in inflation in cost estimates” and that the agreement for Adani included significant grants, all of which were granted at the expense of the public treasury. Exercise the necessary diligence to protect the interests of the government, which develops agreements on P3 projects. In the report presented at the National Assembly, the CAG indicated that extending the duration of the project contract from 30 to 40 years would allow the Adani Group to obtain an additional income of 29,217 kronor. As a general rule, it is customary to grant a contractual term of 30 years to projects implemented under a public-private partnership (PPP) and, if necessary, to extend them at a later date, he said. CAG`s report also states that an amendment to the down payment contract to the Adani Group will allow the Kerala government to prepay an excess capital contribution of EUR 283.08 million, resulting in a loss of interest of EUR 123.71 million. Given that the government supports 67 units of the total investment, revenue sharing should have started with the dealer from the date the private partner will recover its investment, which will be from 2031. At the end of the concession period, the facility is transferred to the authority or the public sector.