Kerala's Battle for Unconditional Viability Gap Funding for Vizhinjam Seaport

The Kerala Government's request for unconditional Viability Gap Funding (VGF) for the Vizhinjam seaport has been rejected by the Centre, which insists on conditions similar to other projects. The Centre maintains the project differs from Tuticorin port, requiring Kerala to share future revenues.

The Centre has dismissed the Kerala Government's plea for unconditional Viability Gap Funding (VGF) for the Vizhinjam seaport. Kerala requested the release of Rs 817.80 crore without any strings attached, but the Centre has ruled that conditions should apply.

Finance Minister Nirmala Sitharaman, in a letter to Kerala Chief Minister Pinarayi Vijayan, confirmed the Centre's commitment to facilitating the Vizhinjam port's commercial viability. However, she outlined terms obligating the state to share 20% of future revenues with the national government.

The controversial decision has sparked criticism, with Kerala officials accusing the Centre of bias, referencing the different approach taken with the Tuticorin port project. However, the Centre maintains that Vizhinjam and Tuticorin projects are not comparable, and previous unconditional grant requests have been denied.

(With inputs from agencies.)