Feasibility Fraud: The Case of International Container Transhipment Terminal

March, 2018

Nityanand Jayaraman, Chennai Solidarity Group & K. Saravanan & Pooja Kumar, Coastal Resource Centre, Chennai 92, 3rd Cross Street, Nagar, Besant Nagar, Chennai 90 Introduction

The Governments of and are trying to convince villagers in Kanyakumari district to allow consultants to conduct a survey to prepare a Detailed Project Report and Environmental Impact Assessment for the Kanyakumari International Container and Transhipment Terminal (KKICTT) proposed to be set up between Kovalam and Manakudy villages in the southern tip of the district. Minister of State for Shipping, Mr. Pon Radhakrishnan, two successive District Collectors and special revenue officials from the Government of Tamil Nadu are engaged in highlighting the bonafides of the proposed project in a bid to win over local farmers and fisherfolk to the Sagarmala dream.

Publicly available documents and a two-day field visit to the project site and its surroundings suggest that the KKICTT project as it is conceived will be illegal and unviable if the laws of the land are to be taken seriously. If allowed to come up at the current site, the project will also have several deleterious effects which have been vastly downplayed by consultants advising the Government and the proponents of the project.

Questionable Feasibility

The project's professed feasibility is founded on a document titled “Addendum No. 1 to TEFR,” henceforth referred to as TEFR (Addendum). This document contains falsehoods and fraudulent statements including some that attempt to show as legal certain documents that have no legal sanction. As a result, the legally unviable KKICTT has been wrongly projected as feasible; further expense of public money is justified on this wrong basis for preparation of DPR and EIA.

The enthusiastic and unquestioning reliance on such questionable documents suggests fraud and high-level collusion between the project consultants Typsa, Boston Consulting Group India, Aether and Price Waterhouse Coopers, and the Central and State Governments, with the latter acting through the district administration and the Forest Department. The collusive effort is geared to making the legally untenable, and socially, financially and environmentally fraught proposal appear to be “viable.”

Background

The current location was chosen after Enayam -- the site identified as most feasible by a Techno-Economic Feasibility conducted by Spain-based consultant Typsa – was abandoned in the face of intense opposition by local communities. The new location – a 2.4 km beach stretch between Kovalam and Manakudy estuary – was identified as the most feasible alternative site and referred to as Kanyakumari-2.

Between October 17, 2017 and November 17, 2017, the Enayam site that was earlier declared as feasible was abandoned, a new site was identified and declared to be even more feasible than the Enayam site on more counts than one. On 29.11.2017, the Ministry of Shipping vide Letter No. E.No.PD-25021/13/2016-VoCPT directed the VOC Port Trust to expedite the preparation of the Detailed Project Report for a port at the new location. On the same day, an application was made for prior Environmental Clearance for the port under the Environmental Impact Assessment Notification, 2006.

Terms of Reference for an Environmental Impact Assessment for the project proposal was issued by the Expert Appraisal Committee (Infra-2) of the Ministry of Environment, Forests and Climate Change on 15.12.2017.

The DPR was expected to be completed by end of March 2018.

Viability Issues

The project site is in Agasteeswaram taluk between Kovalam and Keel Manakudy. The TEFR (Addendum) justifies the choice of Kanyakumari-2 based on a feasibility analysis that is designed to make the site appear to be the most feasible.

As of 06.03.2018 – the date of writing -- the survey for the DPR had not commenced owing to protests by farmers and fishers opposed to the project. This highlights the failure of the TEFR (Addendum) to accurately assess public acceptance of or opposition to the project.

The following errors stand out egregiously:

1. CRZ 1 not CRZ 3:

The TEFR (Addendum) declares that “There would not be any CRZ problems for development of major port at this site.” It claims that the site falls under CRZ 1 between Low Tide Line and High Tide Line, that the area between LTL and HTL is not ecologically sensitive, and that construction and operation of ports are permissible activities under CRZ Notification, 2011. [Page 11 of Addendum to TEFR]

The TEFR (Addendum) refers to a “Draft” Coastal Zone Management Plan (CZMP) to and presents a map which describes the project site as intertidal zone within a CRZ 3 area. Based on this map, Typsa concludes that no CRZ 1 (containing ecologically sensitive features) are affected within the project boundaries, and ascribes a score of “0” (No impact) on “CRZ sensitive areas” for the proposed site. [Pages 75-76]

The draft “CZMP” was commissioned by the Tamil Nadu State Coastal Zone Management Authority (TNSCZMA). This draft has no legal status and is not the correct document to be relied on for appraisal of projects in the CRZ. This was clarified by the MoEFCC by way of a Notification dated 31 July, 2017, wherein it is stated that the validity of the CZMPs already approved under the Coastal Regulation Zone Notification, 1991, was extended up to 31 July, 2018. http://envfor.nic.in/sites/default/files/2-8-2017- notification%20CRZ.pdf

The Goverment of India-approved CZMP and CRZ map for the region, which was prepared and approved in 1996, describes the 2.4 km stretch where the port is to be located as CRZ 1 owing to the presence of several ecologically sensitive features, including turtle nesting grounds and sand dunes. The road-rail corridor falls entirely within the 500 metre No Development Zone, and also crosses a CRZ 1 waterbody at the eastern edge of the port limit.

The approved CZMP and CRZ map for the region downloaded from http://www.environment.tn.nic.in/images/newmaps/30.jpg on 04.03.2018 is in Annexure 1. A map of the project area overlaid on approved CZMP is in Annexure 2.

Had Typsa relied on this legal map, the proposed site would have scored “100” (Severe Impact) not “0” for the criteria “CRZ sensitive areas.”

The fact that this map has been suppressed even while the correct legal document is easily accessible from the official website is a serious lapse by Typsa, especially since the lapse has a materially significant effect on the impact score for the project site. It conveys that Typsa has designed the TEFR (Addendum) to make Kanyakumari-2 the most suitable site.

The draft map relied upon by M/s Typsa was among several other sheets challenged in a case (OA 141/2014) before the National Green Tribunal (South Zone). On 29.09.2015, the NGT (SZ) ordered for the applicant and set aside the maps prepared by the TNSCZMA.

2. The TEFR (Addendum) claims: “The coast line is fairly linear and appears to be stable with vegetation. No evidences of shoreline changes on account of erosion or accretion.

The project site falls on stretch where the coast runs from East to West. Breakwaters – such as are planned for the port will trigger erosion on the eastern side of the structure, and accretion to the west.

The Kovalam-Manakudy stretch is classified as medium erosion as per the Status of Shoreline Change due to Erosion/Accretion by the Institute of Ocean Management.

A physical verification of the coastline east of the proposed port, i.e. Kanyakumari town, reveals severe erosion already in progress. The eroding area contains heritage structures including Vivekananda Memorial Rock, Gandhi Mandapam, Thiruvalluvar Statue and Bhagavathy Amman temple. A structure constructed to view the sunset a few years ago is now entirely inside the sea due to the landward advancement of the sea. The threat to India's signature heritage structures like the Thiruvalluvar Statue and Vivekananda Memorial is already evident, and likely to be aggravated by the construction of the port.

3. The TEFR (Addendum) claims that “The high tide line is well defined and marked by survey stones.”

The 2.4 km stretch where the project is proposed to be set up is devoid of any HTL markers. HTL markers are present outside the eastern and western boundaries of the project. The only survey stones along the length of the proposed project site can be found at a distance of between 60 and 110 metres from the HTL. Even though these stones are not located on the HTL, they are prominently painted in green with the letters “HTL.” Local people allege that the letters “HTL” were painted sometime in November- December by persons engaged by VOC Port Trust. See map containing HTL as in CZMP and freshly painted HTL stones with 80m marked in Annexure 3

4. The TEFR (Addendum) claims that “Shore land of about 80 m in width along the coastline is available for development of port related developments.”

The entire area described as the “shore land of about 80 m” is thickly vegetated sand dune, with casuarina, other dune vegetation and coconut groves that host a resident population of peacocks. Portions of the dune are classified as CRZ 1 (ecologically sensitive) in the Government of India approved CZMP, and hence not available for any development activities including construction of ports or related infrastructure.

5. The TEFR (Addendum) claims that there is “No fishing activities and parking of fishing boats” on the site.

Fishing in this stretch of Kanyakumari, where the three oceans meet, is predominantly in the nearshore waters. The nearshore ocean bed is characterised by reef formations of different kinds of rocks. The GPS coordinates of important fishing grounds used by local fisherfolk marked on a map containing the project's marine structures is in Annexure 4.

It is evident that the consultant for the TEFR (Addendum) has failed to consult local fisherfolk to ascertain whether fishing activities would be affected by the project.

6. Perjury by VOC Port Trust – No protected areas within 15 km of project site.

The project proponent perpetuates the falsehood about the CRZ status of the project site, and about the site's ecological sensitivity.

Question in S.No. 1, of Section III (Environmental Sensitivity) of the Form 1 application for Environmental Clearance from the MoEFCC seeks to know if the project site falls within “Areas protected under international conventions, national or local legislation for their ecological, landscape, cultural or other related value.” In the application for the proposed project, Mr. Suresh, Chief Engineer, VOC Port Trust, answers in the negative.

The CRZ Notification, 2011, is a national legislation. The Government of India-approved CZMP protects this area. The project is classified site as ecologically sensitive (CRZ 1) and development at this site is prohibited.

Form 1 submissions are made under oath. Mr. Suresh and the VOC Port Trust have made false statements under oath.

7. Underplaying Land-use Change.

In Section II (Activity) of Form 1 submission seeking prior environmental clearance from the MoEFCC, the project proponent has responded to questions relating to land-use change in S.No 1.1 to 1.3. The proponent has repeatedly stated that the project is primarily on developed land, and will not have a significant impact on land-use.

Annexure 5 contains a map with existing land-use, land cover. While the road-rail corridor will drastically alter the land-use along the alignment, the presence of a port will also trigger massive port-led urbanisation that will have direct and indirect impacts on land use.

The rich shallow subsurface water and an entrenched agricultural economy dependent on the water is under serious threat by the proposed development. Levelling or paving of the dunes, dredging of the harbour basin and the increase in impervious surfaces in the region will accelerate salinity intrusion and harm drinking water and agricultural security.

8. Suppression of Facts: -Theroor-Mankudy Wetland Complex.

In addition to the CRZ 1 (ecologically sensitive areas) within the project site, the area within 15 km (aerial distance from project boundary) contains numerous ecologically sensitive areas, including the Suchindram-Theroor-Manakudy wetland complex.

The Suchindram and Theroor tanks, in addition to being important bird habitats, flood mitigators and water sources, are also part of Tamil Nadu's irrigation engineering heritage. Both were built by Pandya kings more than 1000 years ago.

The Suchindram-Theroor-Manakudy wetland complex is listed as an internationally recognised “Important Bird and Biodiversity Area” in the 2nd Edition of the “Important Bird and Biodiversity Areas of India” published by the Bombay Natural History Society. Fed by the Pazhayar river, the complex consists of “two groups of adjacent inland freshwater wetlands and an estuary.” By T.N. Government Order Ref. No. G.O. (D) No.39, dated 30.01.2012), Environment and Forests (FR.5) Department, “it was decided to take steps to protect the wetlands of Suchindram-Theroor-Manakudy as Conservation Reserve in Kanyakumari District and for development of bird conservation.”

Substantial scientific documentation establishes the importance of this wetland complex. Excerpts from the listing for this complex in the Important Bird and Biodiversity Areas of India volume bears reproduction in some detail: The entire wetland complex supports c. 100 species of wetland birds, including more than 40 long-distance migrants. The freshwater wetland unit accommodates more than 110 species of aquatic plants and 44 species of fish. About 23 species of fish constitute the major fishery of the estuarine unit, which is the southernmost wintering ground in India for migrant birds from the northern hemisphere. The estuarine unit alone provides important habitats for at least 84 species of resident and migratory waterbirds.

There are more than 44 species of freshwater fish, and over 25 species of estuarine fish in this wetland complex. Some of the prominent ones are Anguilla bengalensis bengalensis, A. Bicolor, Channa orientalis, C. Punctatus, Glossogobius giuris, Heteropneustes fossilis, Horadandia atukorali, Macrognathus guentheri, Mystus montanus, M. vittatus, Ompok malabaricus, Puntius sophore, P. tictopunctatus, P. vittatus, Rasbora (Parluciosoma) daniconius, and Xenentodon cancila.

The Suchindram-Theroor-Manakudy wetland complex is critical for numerous species of commercial and scientifically important fishes and prawns that use these wetlands for various stages of their lifecycle. Two species of freshwater eels Anguilla bengalensis and A. bicolor use these wetlands in critical stages of their lifecycle. Manakudy Estuary serves as the principal migratory corridor for young eels (elvers) to reach freshwater wetlands further upland, and for the breeding adults that come down from the freshwater wetlands in their passage to the sea, where they spawn and die. Suchindram and Theroor wetlands, as well as other freshwater wetlands in Kanyakumari district, provide ideal habitats for young eels in their growing years, until they are ready to return to the sea for breeding. Manakudy Estuary is the spawning ground as well as nursery for commercially important invertebrates such as penaeid prawns, crabs, and others. The commercially important fishes that use this estuary as a nursery include Mugil sp., Lates sp., carangids, gobids, Ambassis sp., Anguilla spp., Sillago sp., Therapon sp., Liza parsia, Gerres filamentosus, Etroplus suratensis, Stigmatogobius javanicus, Glossogobius giuris, Mystus gulio, Chanos chanos, and Hyporhamphus limbatus (Grubh 2004, Thara Devi 2003). These fish are consumed locally and also exported. The local fishing community earns livelihood through commercial exploitation of these fishery products. A map of the various ecologically sensitive and heritage areas within 15 km of the project boundaries is marked in Annexure 6.

Conclusion

The project is premised on false claims and assumptions that make a legally untenable and otherwise unviable proposition seem feasible. It fails on the first principle of good planning – namely siting. If it is pushed through, this project has the potential of disrupting an otherwise healthy economy and exposing a secure population to vulnerability and potential impoverishment.