VOC Port Outer Harbour: Three Firms Bid for the ₹11,733-Crore Hybrid Annuity Project
Three companies, Adani Ports, Megha Engineering and Infrastructures Ltd (MEIL) and Vishwa Samudra, are competing for the Outer Harbour infrastructure contract at V.O. Chidambaranar (VOC) Port in Thoothukudi, Tamil Nadu.
The works are worth about ₹11,733 crore and will be built under the Hybrid Annuity Model (HAM), where the government pays part of the cost during construction and the rest over time.
In late September 2026, the Cabinet Committee on Economic Affairs (CCEA) approved the wider outer harbour plan at about ₹17,167 crore: about ₹11,733 crore for HAM works and about ₹5,434 crore for container terminals under the Design-Build-Finance-Operate-Transfer (DBFOT) model.
The HAM works include a northern breakwater (about 2,000 m), a southern breakwater (about 3,650 m), capital dredging (deepening the sea bed) and reclaiming land from the sea for container yards. The plan provides for two deep-draft terminals, each with a 1,000 m quay and an 18 m draft.
This is the third attempt to find a private partner. The 2022 tender (about ₹7,200 crore) drew only two bidders, both disqualified, and the December 2024 tender (about ₹7,056 crore, on the DBFOT model) drew none. The switch to HAM was made to reduce the risk for private firms.
A key aim is to cut dependence on Colombo port (Sri Lanka), which handles a large share of the containers moving to and from Thoothukudi.
Hybrid Annuity Model (HAM)
The Hybrid Annuity Model, or HAM, is a way for the government and a private company to build infrastructure together and share the cost. The government pays 40% of the project cost while the work is being built. The private company arranges the other 60% and gets it back, with interest, through fixed payments called annuities spread over many years after the project is finished. It is a "hybrid" because it mixes two older models: one where the government pays for everything, and one where the private company pays for everything.
VOC Port's outer harbour failed to attract good bids twice when private firms had to carry the full risk. By moving the ₹11,733-crore breakwater, dredging and reclamation works to HAM, the government now pays part of the cost during construction and the rest as annuities. This lowered the risk enough for three firms, Adani Ports, MEIL and Vishwa Samudra, to compete.
V.O. Chidambaranar Port (VOC Port), Thoothukudi
V.O. Chidambaranar Port is a major port at Thoothukudi (Tuticorin) in southern Tamil Nadu, on the Gulf of Mannar. It lies close to the busy East-West international shipping route that links East Asia with the Middle East and Europe. It is an artificial deep-sea harbour run by the V.O. Chidambaranar Port Authority under the Union Government.
The outer harbour will let very large container ships call directly at Thoothukudi. This could reduce India's dependence on Colombo for transshipment and make VOC Port a stronger hub in southern India.
Major Ports vs. Minor/Non-Major Ports and Port Governance in India
India's ports are divided into two legal groups. Major ports are controlled by the Union Government through the Ministry of Ports, Shipping and Waterways. Non-major ports (often called minor ports) are managed by state governments, usually through state maritime boards. The difference depends on the legal status of the port, not its size.
VOC Port is a major port, so its outer harbour is approved by the Union Cabinet and run under the Major Port Authorities Act, 2021. The project splits the work in landlord-model style: HAM for the basic marine works and DBFOT for the container terminals.
- Bidders: Adani Ports, Megha Engineering and Infrastructures Ltd (MEIL), Vishwa Samudra
- HAM works at VOC Port: about ₹11,733 crore
- Total outer harbour plan (CCEA, September 2026): about ₹17,167 crore; DBFOT container terminals about ₹5,434 crore
- Two terminals: 1,000 m quay each, 18 m draft
- Breakwaters: northern about 2,000 m, southern about 3,650 m
- Earlier tenders: 2022 (about ₹7,200 crore), December 2024 (about ₹7,056 crore); the current HAM tender is the third attempt
- HAM: 40% government support during construction, 60% private, repaid via annuities with interest at Bank Rate + 3%
- VOC Port: Thoothukudi, Tamil Nadu, Gulf of Mannar; major port since 1974; named after V.O. Chidambaram Pillai