The Government of Puducherry (GoP) took steps to develop the minor Port of Pondicherry into a deep water Port with direct ship berthing facilities through private investment on Build, Operate and Transfer (BOT) basis.
The first such effort was during 1999, the second during 2003 and the third effort was in 2004. Subsequent to the signing of a Concession Agreement with a private developer, the Port project got entangled in litigation from 2006 to 2010. Subsequently in May 2013, the private developer went for Arbitration seeking a compensation of Rs 1,511 crore plus interest from the GoP. The Arbitration Tribunal constituted to decide on arbitration unanimously announced a "NIL" award on 18.07.2016. Thus, all the three attempts to develop Puducherry port as a deep water port with direct ship berth facility did not succeed.
With the approval of the Ministry of Shipping (MoS) on 15.03.2017, the GoP signed a Memorandum of understanding (MoU) with the Chennai Port Trust (ChPT) to develop Puducherry Port as its feeder port. To start with, 3.5 lakh tons of cargo per annum comprising of container Cargo and General cargo shall be handled and the cargo volumes shall be gradually ramped up.
A trail run on container service between the Ports of Chennai and Puducherry was carried out on successfully 24.02.2018 in the presence of top dignitaries of the Government of Puducherry (GoP). A proposal to develop Puducherry Port with 100% funding under "Sagarmala" has been submitted to the Ministry of Shipping, Government of India, New Delhi and its decision is awaited.
A proposal to start passenger ferry service between the ports of Chennai and Karaikal through Pondicherry Port is also on the anvil.
Towards expansion of Karaikal port, M/s Karaikal Port Private Limited, the private developer of Karaikal port has submitted a proposal to the GoP to establish a "LNG Terminal".
The above said development plans for the Pondicherry and Karaikal ports shall create direct/indirect employment opportunities and also generate revenue to the Government of Puducherry and the Government of India.