Container transshipment at the Indian port of Vizhinjam could see a significant increase after MSC, the world’s leading liner operator, agreed to invest in a key Adani Ports project.

Through its port division TiL, MSC is acquiring a 49% stake for approximately $1.4 billion. This deal coincides with the launch of the second phase of expansion at the new Adani Ports (APSEZ) hub, valued at around $1.7 billion. As a result, the port’s container handling capacity is expected to nearly quadruple—from 1.6 million TEU to 5.8 million TEU by 2028.

MSC already collaborates with APSEZ at terminals in the ports of Mundra and Ennore, bringing significant synergies to both parties. Mundra currently serves as a major regional hub for the Geneva-based carrier.

According to APSEZ, the partnership in Vizhinjam will enhance cargo volume predictability and accelerate the port’s capacity growth by attracting additional cargo flows. This strategic cooperation marks the largest private foreign investment in India’s port infrastructure and cements Vizhinjam’s status as a leading gateway for transshipment in the Indian Ocean.

APSEZ received a 40-year concession from the Kerala state government to develop and operate Vizhinjam in 2015. However, the launch of the first phase terminal was postponed until 2024 due to various obstacles, including protests by local fishermen.

The industry’s interest in Vizhinjam is driven by its natural advantages: the port can accommodate ultra-large container vessels thanks to its deep natural harbor and proximity to the international east-west shipping lane, requiring minimal deviation from the main route.

The terminal is already operating at full capacity, as MSC’s transshipment vessels are gradually being shifted from the port of Colombo (Sri Lanka). Vizhinjam became the first Indian port to reach the 2 million TEU mark in less than 18 months of operation. Last month, the port welcomed its 1,000th vessel, including about 70 ultra-large container ships (ULCVs).

Vizhinjam is recognized as India’s first automated port, enabling faster vessel turnaround. Indian container industry stakeholders believe MSC’s involvement in managing Vizhinjam will help India realize its ambitions to create a maritime hub, reclaim cargo previously routed through other hubs, and balance trade flows in South Asia.

The deal has sparked political debate: state authorities claim APSEZ did not seek approval for the sale of a terminal stake to a third party, as required by the concession agreement. There are also concerns that having a single shipping operator at Vizhinjam could lead to a monopoly in the long term.

For APSEZ, which manages a network of 15 ports and terminals across India, the model of strategic alliances with major container carriers has already proven effective. According to available data, the company has a nationwide capacity of about 15 million TEU.