The Adani group has started construction on India’s first trans-shipment port – an intermediary port that allows container ships to offload before their journeys end, Reuters reported. The Indian government will give the Adani Group a grant of Rs 1,600 crore for the project, which it hopes will bring in new business by competing with China and other Asian nations. The port is being built at Vizhinjam, Kerala.

The government believes it can tap a huge market, as India lies on a key shipping route, by improving its cargo handling capacity. Currently, major onshore handling is done in Singapore, Sri Lanka and Dubai. After the Vizhinkam port is completed, the government plans to build another facility, worth $ 4 billion (Rs 27,200 crore) in Enayam, Tamil Nadu. The Centre believes the new ports will save Indian companies hundreds of millions of dollars every year.

China has been investing in the development of ports in Sri Lanka, Maldives and Bangladesh, which officials believe are a cause of concern to the Indian government. China is also developing the Gwadar seaport in Pakistan. Earlier, India had rejected a proposal by China to invest in the Vizhinjam port.