Shipping sector poised for growth in 2010

Shipping sector poised for growth in 2010

Shipping sector poised for growth in 2010

The shipping turf also saw a fierce battle between two leading private shipbuilders in a bid to gain control over an offshore drilling firm while the Dubai financial crisis during the close of the year had triggered panic among Indian seafarers.

The year saw a move to transfer the strategic state-owned Hindustan Shipyard to Defence for construction of nuclear submarines besides setting up of two new shipyards.
Apart from these, in a major move to expedite public-private partnership projects amid shrinking maritime trade globally, the Shipping Ministry authorised port authorities for awarding contracts to winning bidders without its prior approval.

As a result, 2009 saw completion of 47 projects under the National Maritime Development Programme (NMDP) while Work is in progress in 71 amounting to Rs 16487.95 crores and projects worth Rs 15,000 crore are in various stages to be awarded.

In investment terms, the government had earmarked Rs 55,000 crore for the 11th Five-Year period (2007-12) but the expenditure started in 2009.

The real progress began in 2009 when an empowered committee was set up to expedite the process addressing issues like delays, largely on account of security clearances and late finalisation of model concession agreements. There are a total of 276 projects to be completed during the Plan.

Earlier, the government had to satisfy with only 70 MT increase in port capacity halfway through the Plan.

It had set an ambitious target of doubling the capacity at the 12 major ports to 1016. 55 MT in the 11th Five-year Plan (2007-2012) from 505MT.

Now, with capacity expansion programme going in full swing, ports are expected to handle more traffic at the close of the current fiscal. The traffic handled at 12 major ports on April 1, 2009 stood at about 575 million tonnes as compared to about 530 million tonnes a year-ago.

The 12 state-owned major ports are Kolkata, Paradip, Vishakhapatnam, Ennore, Chennai, Tuticorin, Cochin, New Mangalore, Mormugao, Mumbai, JNPT and Kandla. The year also saw all preparations to transfer state-owned Hindustan Shipyard (HSL) from the administrative control of the Shipping Ministry while the Cabinet can consider it any day. HSL, valuation came to a little over Rs 1,000 crore and transfer will be critical to the navy’s plan to induct a fleet of nuclear submarines in the coming years. The government gave clearance for setting up two major shipyards one each on the East and the West Coast.

Besides, the government prepared a draft bill for bringing in nearly 200 non-major ports under the purview of Tariff Authority for Major Ports, which currently fixes tariff for the major ports only.

Talking about the private players one is reminded of the ABG Shipyard and Bharti Shipyard battle. The months-long battle between ABG Shipyard and Bharti Shipyard for a controlling stake in Great Offshore ended after the former sold its stakes in offshore drilling firm.

ABG sold its 30 lakh shares representing 8.27 per cent stake in the drilling firm.
The year saw another major announcement by the Shipping Ministry to develop cruise terminal and infrastructure to attract luxury liners  in order to make the country a global tourism destination, the government will .

“Cruise shipping would be a path breaking development in India’s efforts to carve a prominent space in world tourism and it would showcase India as a major source and destination of world tourism,” Shipping Minister G K Vasan said.

The number of cruise ships which called at Indian ports increased in the year while the number of cruise passengers too saw a jump.

Italian luxury liner Silversea Cruises, which sails across seven continents in over 80 countries, covering more than 400 destinations already announced launching services in the country at the close of the year.