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Since 1st March, 1999
 
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Cash wave to hit Cochin, Paradip

New Delhi, Oct. 10: The shipping ministry has shortlisted Paradip on the east coast and Cochin on the west coast to set up two world-class shipyards. The total investment in the two projects could be as much as Rs 6,000 crore.

Shipping secretary D.T. Joseph has set up a committee headed by the chairman of the Jawaharlal Nehru Port Trust to look into the preliminary aspects for establishing the national shipyards. The appointment of consultants for the project is expected to take place after this report arrives.

Sources said the ministry had chosen Paradip and Cochin as the sites for the shipyards on a “tentative” basis. This could imply that political pulls and pressures would come into play for the final decision on the sites of these prestigious projects, which will see huge investments flowing in.

The proposal envisages building two major international size shipyards, which would exploit the advantage of the country’s cheap labour force to build very large ships that are currently in demand.

Indian shipping companies such as SCI and Great Eastern have also placed their orders for new ships with South Korean shipyards.

These companies also send their larger ships for repairs outside the country as the indigenous shipyards are too small. The shipping ministry is keen to reverse this trend.

Cochin Shipyard is the only shipyard in the country that has the capacity to build and repair large ocean-going ships. However, even this capacity of 130,000 DWT will have to be expanded as current shipbuilding orders are mainly for VLCCs with the smaller Aframax tankers constituting only a minor proportion of the demand.

With the exception of the Cochin shipyard all the other 20 shipyards in the country are either running into losses or merely breaking even.

Due to a lack of orders the present capacity utilisation of Indian shipyards ranges from a meagre 20 to 50 per cent. The shipping ministry under its national maritime development programme estimated that an outlay of Rs 2,800 crore would be required for upgrading the existing shipyards in the public sector over the next 10 years, while the private shipyards would need an investment of Rs 1,200 crore.

There has been a huge leap in sea freight rates and shipping companies world-wide have gone in for massive expansion plans to rake in extra profits.

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