The Indian arm of DP World, known as Hindustan Ports, has received a letter of acceptance from the Deendayal Port Authority to construct a mega container terminal at Tuna Tekra in the state of Gujarat.

The new terminal will be built at the Tuna Tekra satellite facility and have the capacity to handle 2.19 million twenty-foot equivalent units (TEUs) a year, reported ET Infra.

This major box terminal project is expected to cost around $520.5m (Rs42.43bn).

Hindustan Ports defeated Adani Ports and Special Economic Zone (APSEZ) with a royalty quote of Rs6,500 per TEU during the bidding process.

APSEZ had placed a bid of Rs1,500 per TEU.

With an initial depth of 14.5m without tidal restrictions, the planned box terminal is expected to handle ships that can carry more than 21,000 TEUs.

Based on a cost-sharing basis and mutual consensus between the parties, the depth of the terminal can be increased to 18m.

Deendayal Port Authority deputy chairman Nandeesh Shukla was quoted by the news publication as saying “The letter of acceptance of the bid was issued to Hindustan Ports late evening on Friday.

“We respect the trust and confidence DP World has reposed in us with its bid and will try to make the project a resounding success.”

The Tuna-Tekra container terminal is part of the government’s National Infrastructure Pipeline.

Last October, the Indian Government’s Union Cabinet approved the construction of a container terminal at the Deendayal Port.