Editorial 2: The mirage of port-led development in Great Nicobar

Context

The facts reveal that the project’s supposed ‘advantages’ are broad assertions that ignore or minimize its significant costs.

Introduction

Supporters of the proposed seaport at Great Nicobar, recently in the media spotlight amid a wave of criticism, argue that the project will transform India into a regional centre for maritime security and economic growth. They dismiss concerns that it is an ill-conceived venture endangering indigenous communities and ecological balance, portraying it instead as a strategic and commercial breakthrough.

• The credibility of the project’s claims is becoming increasingly doubtful.
• A closer examination shows that its purported benefits are exaggerated, while its structural weaknesses and environmental costs are consistently - and sometimes deliberately - minimized.
• What’s truly at stake is not only the ecological and commercial sustainability of the port, but also whether its grand promises of economic and strategic transformation have any real foundation.

A Flawed Rationale

• Understandable but misplaced logic: Supporters argue that since India depends heavily on foreign ports like Colombo and Singapore for transshipment, a mega port at Galathea Bay (Great Nicobar) would help India capture a larger share of regional container trade.
• Faulty assumption of automatic traffic: The idea that building port capacity will automatically attract shipping traffic is misleading. The Vallarpadam Port in Kerala stands as evidence that infrastructure alone doesn’t ensure success.
  • Transshipment hubs thrive on network connectivity, feeder links, cargo base, and carrier loyalty — factors that cannot be guaranteed merely through large-scale construction.
• Lack of hinterland support: Galathea Bay suffers from a critical structural handicap — the absence of an industrial or logistics base.
  • Every container must be imported and exported, with no local industry to generate or anchor trade flows, making sustained growth difficult.
• Connectivity deficit: Unlike Colombo, which is integrated into a dense web of short-haul maritime routes across South Asia, East Africa, and Southeast Asia, Nicobar lacks comparable network linkages.
  • Building such a system would demand heavy subsidies and prolonged state intervention, which shipping companies may find commercially unviable.
• Geographical disadvantage: Being nearly 1,200 km from the Indian mainland, Galathea Bay’s remoteness raises costs - every supply, from containers to personnel, must be shipped in.
  • This isolation would disrupt shipping schedules, discouraging major carriers from including it as a regular stop.
• Unrealistic targets: Even Colombo, with its established networks and loyal carriers, handles less than eight million TEUs a year.
  • The claim that Nicobar-  with no committed lines - could double that volume is highly implausible and stretches credibility.

Misplaced Imperatives

1. Questioning Strategic Justification

• Some claim that Great Nicobar’s port gains legitimacy from its strategic military value.
• They argue that a forward military presence strengthens India’s maritime surveillance and deterrence in the eastern Indian Ocean.
• However, this logic is limited, as INS Baaz already performs such surveillance roles effectively.
• The necessity of a commercial port to serve military objectives remains unclear, especially since China’s navy hasn’t directly threatened India in the region.
• If strategic aims do justify a stronger presence, they should be pursued openly, not disguised as economic development.

2. Overstated Maritime Connectivity

• Assertions that Galathea Bay, Vizhinjam (Kerala), and Vadhavan (Maharashtra) could form a seamless maritime arc are impractical.
• These ports belong to different maritime zones and operate under distinct economic conditions.
• Vizhinjam may attract transshipment traffic from Colombo due to its location near international sea lanes and potential efficiency advantages.
• Vadhavan possesses its own commercial logic, capable of independent growth.
• Galathea Bay, by contrast, is isolated, far from industrial corridors, and lacks a cargo base, making it unsuitable as a hub.
• Portraying it as the core of a national maritime network disregards practical and logistical realities.

Lacking Logistics

1. Structural Disadvantages in Trade Networks

• Global shipping patterns are deeply entrenched, and carriers resist altering established routes.
• Colombo and Singapore offer integrated logistics and operational rebates that make them more attractive to shipping lines.
• In contrast, Indian ports - despite large investments — still impose higher port-calling and handling charges, reducing competitiveness.
• The example of Krishnapatnam Port (Andhra Pradesh) — where container services were fully withdrawn in 2024 and operations shifted to bulk cargo — highlights how costs and network integration shape liner preferences.

2. The Vizhinjam Reality Check

• Vizhinjam’s initial success is often cited as a model, but its growth stems from shipping relationships, not natural trade demand.
• Although it recorded around 500 merchant vessel calls, most came from a single company - MSC, which also seeks an ownership stake in the terminal.
• The absence of commitments from other major carriers to move from Colombo reveals a structural weakness: ports need long-term carrier partnerships to sustain traffic.

3. The Galathea Bay Limitation

• Galathea Bay, being geographically isolated and logistically underdeveloped, cannot replicate the performance of mainland ports.
• Without a robust logistics ecosystem, it faces severe challenges in attracting or maintaining regular maritime traffic.

Conclusion

The Great Nicobar project is undeniably ambitious, reflecting India’s aspiration to enhance its maritime presence and regional connectivity. Yet, ambition that is detached from economic and logistical realities seldom leads to success. A world-class port without sufficient users or traffic will neither boost India’s influence nor drive sustainable development. Instead, it risks becoming a symbol of overreach - a cautionary tale of misplaced ambition, reminding that vision must align with practicality.