According to Highways Minister T Kiruttinan, the Government would pursue the canal project further only after NEERI submits a detailed report on the likely impact of the project in the region. While the Tuticorin Port will be the nodal agency for the Central Government, the Tamil Nadu Maritime Board will be in charge of the project on behalf of the State Government.

The techno-economic feasibility report prepared by a private agency has concluded that the project would entail an outlay of Rs 680 crore for 30 feet depth of the canal, Rs 750 crore for 31 feet, and Rs 1,180 crore for 35 feet. The NEERI has already submitted a draft report on the project as directed by the Union Ministry of Surface Transport.

From receiving budgetary support of Rs 1.50 crore in 1998-99,the Tamil Nadu Maritime Board, which is in charge of executing the expansion plans of the minor ports in the State, is expected to earn Rs 3.15 crore from the operations of captive ports at Ennore, Cuddalore, Tiruchopuram, P Y 3 oil field, Tirukadaiyur and Nagapattinam. The captive ports are operated by private corporates for their own use.

A minor port needs an investment of Rs 500 crore and above, but private companies are reluctant to participate in the construction and maintenance of minor ports. Therefore, the Government has decided that the Maritime Board will invest on a priority basis in Nagapattinam and Vallinokkam ports.