Among the backers of a seaport at Great Nicobar — much in the media spotlight, following a spate of critical commentaries — a favourite argument is that the facility will position India as a regional hub for maritime security and economic growth. Proponents reject suggestions that the port is a misguided venture that threatens indigenous communities and risks ecological collapse. Instead, they present it as a strategic and commercial game-changer.
That claim is increasingly questionable. A closer look reveals that the project’s supposed advantages are overstated, while its structural flaws and environmental costs are routinely, often wilfully, downplayed. At stake is not just the port’s ecological and commercial viability, but whether the sweeping claims of economic and strategic transformation attached to it are grounded in reality.
A flawed rationale
The supporters’ logic is, at one level, understandable. India remains heavily dependent on foreign ports, especially Colombo and Singapore, for transshipment. The argument is that a mega port at Galathea Bay (Great Nicobar) would allow India to wrest traffic from foreign hubs and claim a greater share of regional container trade. Yet, the proposition rests on the faulty assumption that creating port capacity automatically attracts traffic. The experience with the Vallarpadam Port in Kerala suggests otherwise. Transshipment hubs flourish not on infrastructure alone but on network connectivity, feeder links, cargo base and carrier loyalty — none of which can be assured by merely building a high-capacity terminal.
Galathea Bay suffers from deep structural limitations. It has no real hinterland — no urban centre, industrial zone, or logistics base to support the port. Every container must be shipped in and out, with no local industry or cargo base to anchor sustained growth. Even as a transshipment hub, the port would depend on feeder services that do not yet exist. Unlike Colombo, which sits within a dense web of short-haul routes linking South Asia, East Africa and Southeast Asia, Nicobar lacks comparable connectivity. Creating such a network would require massive subsidies and long-term state support — a prospect few shipping lines are likely to find commercially credible.
Geography, in fact, may be the project’s biggest handicap. Located about 1,200 kilometres from the Indian mainland, Galathea Bay is too remote to support cost-effective feeder operations. Everything — from containers and provisions to port personnel and fuel — would need to be shipped in, raising operating costs. Shipping schedules would have to be significantly revised to include such an isolated location, a prospect few carriers are likely to find worthwhile.
It is instructive that Colombo, despite long-standing carrier relationships and established networks, has managed fewer than eight million Twenty-foot Equivalent Units (or TEU, which is the unit of cargo capacity) a year. That Nicobar, with no committed lines, aims to double that figure, stretches credulity.
Misplaced imperatives
Some argue that the port’s economic rationale is strengthened by its strategic utility. A forward military presence in Great Nicobar, they say, enhances maritime domain awareness and bolsters India’s deterrence posture in the eastern Indian Ocean. That may be true in a limited sense. INS Baaz, the existing naval facility, already supports surveillance operations. Yet, it is unclear why a commercial port is needed to support a military mission, especially when the Chinese navy has yet to frontally challenge Indian interests in the region. Even if strategic imperatives warrant a stronger posture, that objective ought to be pursued transparently, not cloaked in the language of commercial development.
Claims that Galathea Bay will integrate with Vizhinjam (Kerala) and Vadhavan (Maharashtra) to form a seamless maritime arc are no less fanciful. The vision overlooks the fact that these ports operate in distinct maritime theatres and are shaped by fundamentally different commercial realities. Vizhinjam, given its proximity to international shipping lanes, may plausibly draw transshipment traffic from Colombo — especially if it delivers faster turnaround times and regulatory efficiency. Vadhavan has its own commercial logic and could thrive independently. Galathea Bay is geographically isolated, cut off from industrial corridors, and lacks any organic cargo base. To treat it as a linchpin in a future Indian maritime arc is to ignore the practical requirements of hub functioning.
Lacking logistics
Mercantile trading patterns suggest that carrier commitments are often shaped by a reluctance to disrupt entrenched trade networks. Major shipping lines benefit from operational rebates and integrated logistics at Colombo and Singapore — advantages that Indian ports struggle to match. Despite heavy investment, Indian terminals continue to levy significantly higher port-calling and handling costs. The experience at Krishnapatnam Port (Nellore, Andhra Pradesh) — a full withdrawal of container services in 2024, and a strategic reorientation to bulk-cargo — powerfully illustrates how cost structures and network integration continue to shape liner decisions.
For those who point to Vizhinjam as a success story, it bears highlighting that it, too, is a case of shipping relationships driving merchant traffic rather than organic demand. While the port has logged an impressive 500 merchant calls, the majority of traffic has come from one shipping company— MSC — which, not coincidentally, is eyeing an ownership stake at the terminal. That no other major carrier has committed to shifting operations from Colombo underscores a broader truth: without strong carrier relationships, even well-situated ports struggle to attract sustained traffic.
While Galathea Bay cannot be expected to replicate the performance of a mainland port, it should be clear that a terminal lacking a viable logistics ecosystem faces steep odds.
The Great Nicobar project is undoubtedly ambitious. Yet, ambition, divorced from economic and logistical realities, is no recipe for success. A world-class port with few takers will yield neither influence nor development. It will stand instead as a cautionary lesson in misplaced ambition.
Abhijit Singh is a retired naval officer and former head of the Maritime Policy Initiative at the Observer Research Foundation, New Delhi
Published – October 25, 2025 12:08 am IST
