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Ship Building by Public Sector Shipyards



Ship Building by Public Sector Shipyards 
There are two Public Sector Shipyards viz. Cochin Shipyard Limited(CSL) , Kochi and Hooghly Dock & Port Engineers Limited (HDPEL), Kolkata under the administrative control of Ministry of Shipping and four Public Sector Shipyards under the administrative control of Ministry of Defence viz. Mazagon Dock Limited (MDL), Mumbai, Garden Reach Shipbuilders & Engineers Limited (GRSEL), Kolkata, Hindustan Shipyard Limited(HSL), Visakhapatnam and Goa Shipyard Limited (GSL),Goa. The number of ships/boats/cargo ships manufactured by the Central Public Sector Shipyards during each of the last three years and the current year by these shipyards is given in tabular below:


1. Cochin Shipyard Limited, Kochi
SL. No
Financial Year
Number of Ships/boats/cargo ships manufactured by CSL
1
2012-13
6
2
2013-14
7
3
2014-15
7
4
2015-16  (Till date)
6
2. Hooghly Dock & Port Engineers Limited, Kolkata
S.No.
Financial Year
Number of Ships/boats/cargo ships manufactured by HDPEL
1
2012-13
1
2
2013-14
0
3
2014-15
0
4
2015-16  (Till date)
4
3. Hindustan Shipyard Limited
S.No
Financial Year
Number of Ships/boats/cargo ships manufactured by HSL
1
2012-13
1
2

2013-14
5
3
2014-15
0
4
2015-16  (Till date)
3
4. Garden Reach Shipbuilders & Engineers Limited
S.No
Financial Year
Number of Ships/boats/cargo ships manufactured by GRSEL
1
2012-13
4
2
2013-14
2
3
2014-15
2
4
2015-16  (Till date)
1
5.         Mazagon Dock Limited
S.No
Financial Year
Number of Ships/boats/cargo ships manufactured by MDL
1
2012-13
2
2
2013-14
0
3
2014-15
2
4
2015-16  (Till date)
1
6. Goa Shipyard Limited
S. No
Financial Year
Number of Ships/boats/cargo ships manufactured by GSL
1.
2012-13
10
2.
2013-14
16
3.
2014-15
4
4.
2015-16  (Till date)
14


The number of new and old ships/boats imported by Shipping Corporation of India, Dredging Corporation of India and Inland Waterway Authority of India which are under the administrative control of Ministry of Shipping is given below:

Shipping Corporation of India
S.No
Financial Year
Nos
Country
1
2012-13
7
China & Korea
2
2013-14
2
China
3
2014-15
1
China
4
2015-16 (Till date)
0

The Dredging Corporation of India
S.No
Financial Year
Nos
Country
1
2012-13
1
Netherlands
2
2013-14
2
Netherlands
3
2014-15
0

4
2015-16 (Till date)
0

Inland Waterway Authority of India
S.No.
Financial Year
Nos
Country
1
2012-13
2
Finland
2
2013-14
0

3
2014-15
0

4
2015-16
0



Government of India had a shipbuilding subsidy scheme for Indian Shipyards which expired on 14.08.2007.The  shipbuilding subsidy scheme had provided subsidy for domestic orders of 80 m length and above which were obtained only on global tender basis. Export orders were also eligible for subsidy.

Government of India has approved a New Financial Assistance Policy for Indian Shipyards to provide a level playing field vis a vis foreign shipyards. Financial assistance @20% of the “Contract Price” or the “Fair Price” as determined by international valuers, whichever is lower, is to be applicable for shipbuilding contracts signed during the dated April 1, 2016 to March 31, 2026 including the said dates. The 20% financial assistance would be provided for ten years reducing @3% every 3 years.

This information was given by Minister of State for Shipping, Shri Pon. Radhakrishnan in a written reply to a question in theLok Sabha today. 

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Steps to Increase Freight Activities 
In the year 2014-15, the Indian ports handled 172.67 million tonnes coastal cargo while overseas cargo handled was 879.56 million tones

Ministry of Shipping has taken following steps to increase freight activities in domestic shipping in the country.

(i) Support to Major/Non-Major ports/State Government for creation of infrastructure for movement of coastal cargo.

(ii) Relaxation of technical and operational requirement for ships operating in Indian coast.

(iii) All major ports have been advised to introduce Green Channel for coastal cargo, priority berthing for coastal vessels and construction of exclusive coastal berths.

(iv) Removal of customs and central excise duty on bunker fuel used for transportation of mix of EXIM, empty and domestic containers.

(v) Reduction of service tax incidence on coastal shipping.

(vi) Cabotage relaxation for specialized vessels such as Ro-Ro, Hybrid Ro-Ro, Ro-Pax, Pure Car Carriers, Pure Car and Truck Carriers, LNG vessels and Over Dimensional Cargo or Project Cargo Carriers which are in short supply in India.

This information was given by Minister of State for Shipping, Shri Pon. Radhakrishnan in a written reply to a question in the Lok Sabha today. 
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Infrastructure Status to Shipyard Industry 
The Institutional Mechanism on Infrastructure of the Department of Economic Affairs in its 10th meeting on December 21, 2015 has recommended inclusion of shipyards as “infrastructure”. Infrastructure status would enable Indian shipyards to avail cheaper long-term source of capital for Indian shipbuilding and ship repair industry. The attendant tax benefits would enable the shipyards to reduce their cost disadvantage and invest in capacity expansion. The shipyards would be able to avail flexible structuring of long term project loans, long term funding from infrastructure funds for longer tenure equivalent to the economic life of their assets, relaxed ECB norms, issuance of Infrastructure bonds for meeting working capital requirements as well as benefits under Income Tax Act, 1961. This would boost the growth in this sector and the ‘Make in India’ initiatives.

A note was circulated by Ministry of Shipping which intended to increase Indian tonnage by relaxing such condition of FOB/FAS imports subject to a minimum of 50% of their annual requirement being met through long term charter contracts with Indian shipping companies.

In order to make the Indian shipping industry attractive and more competitive, the Government has exempted Customs and Excise Duty leviable on bunker fuels used in Indian flag vessels for transportation of mix of EXIM, domestic and empty containers between two or more ports in India. Government has brought in a uniform abatement of service tax for transportation of goods by rail, road and sea vessels. Indian shipping industry has been provided cargo support through Right of First Refusal (RoFR). Besides this , Government has taken a policy decision to allow shipping enterprises based in India to acquire ships abroad and also flag them in the country of their convenience. As a step towards promoting ‘Ease of Doing Business’ methodology for computation of period of stay of seafarers in India has been redefined. Shipbuilding industry in India employ around 39770 people.

This information was given by Minister of State for Shipping, Shri Pon. Radhakrishnan in a written reply to a question in the Lok Sabha today. 
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Status of Development of National Waterways -3 

Kottapuram- Kollam stretch of West Coast canal (168 km) along with Champakara canal (14 km) and Udyogmandal canal (23 km) (totalling 205 km) were  declared as National Waterway-3 (NW-3) on February 1, 1993. The present status of development of  NW-3 is given below:

(i)     Navigable Channel
Navigable channel of minimum 38 meters bottom width in wider sections and 32 meters bottom width in narrow sections with minimum 2 meters depth has been developed and maintained in entire NW-3 except a small portion of 3.25 km where width is 12 meters.
(ii)Aids for 24 hours Navigation
The entire NW-3 in Kerala has been provided with navigation aids to facilitate 24 hours navigation.
(iii)     Cargo handling terminals
Cargo terminals have been set up at eight locations with safe berthing arrangement for inland vessels, storage go-downs, cargo handling equipment. These locations areKottapuram, Aluva Maradu(Kochi),  Vaikkom, Cherthala (Thanneermukkom) Thrikkunnapuzha,  Kayamkulam (Ayiramthengu) and Kollam. Construction is nearing completion at  the ninth  terminal at Alappuzha. In addition, for decongesting the Kochi city by providing an alternate transport route to International Container Transhipment Terminal (ICTT), a pair of Ro-Ro terminals at Willingdon Island and Bolghatty have been provided.

 As per the study conducted for extension of West Coast Canal (National Waterway-3) by M/s NATPAC,  the viable stretch between Kottapuram to Kozhikode has been included for declaration as an extension of National Waterway-3 in the National Waterways Bill, 2015. The Bill has already been passed by the Lok Sabha in the Winter Session, 2015 and is expected to be taken up for consideration by Rajya Sabha during the Budget Session, 2016.
  
    This information was given by Minister of State for Shipping, Shri Pon. Radhakrishnan in a      written reply to a question in the LokSabha today. 

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Scheme for Incentivizing Modal Shift of Cargo 
Ministry of Shipping has launched a Scheme called “Scheme for Incentivizing Modal Shift of Cargo” or “SIMSC”. The Scheme broadly covers the following:-

The incentives under SIMSC will be provided to the beneficiaries for undertaking transportation of the following categories of cargo through Indian flag vessels, River Sea Vessels or barges on coastal shipping and inland waterways routes, namely:-

(i) Transportation of bulk or break – bulk cargo pertaining to seven commodities viz. Fertilizers, food grains, marbles, tiles, sugar, edible salt and over – dimensional cargo, shall be eligible for an incentive @ Re. 1 per tonne per nautical mile upto a maximum of 1,500 nautical miles in each trip starting from origin and ending at the destination. The number and type of commodities under this head are subject to revision by the Government from time to time.

(ii) Transportation of any commodity in containers in Full Container Load (FCL) shall be eligible for an incentive @ Rs.3,000/- per TEU. Thus transportation of any commodity through forty feet or other larger sized containers shall be incentivised based on number of times the said container size can be converted into TEUs.

(iii) Transportation of vehicles through Ro-Ro Vessels shall be eligible for the following incentives:

(a) Incentive @ Rs. 300/- per two-wheeler vehicle;

(b) Incentive @ 600/- per three-wheeler vehicle; and

(c) Incentive @ Rs.3,000/- for other vehicles.

In addition, as per TAMP guidelines Concession on Tariff is permitted and accordingly, the cargo/container related charges for all Coastal Cargo other than Iron Ore, Thermal Coal and POL should not exceed 60% of the normal charges.

This information was given by Minister of State for Shipping, Shri Pon. Radhakrishnan in a written reply to a question in the Lok Sabha today. 
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Reforms in Shipping Sector 
In order to make the Indian shipping industry attractive and more competitive, the Government has exempted Customs and Excise Duty leviable on bunker fuels used in Indian flag vessels for transportation of mix of EXIM, domestic and empty containers between two or more ports in India. Government has brought in a uniform abatement of service tax for transportation of goods by rail, road and sea vessels. Indian shipping industry has been provided cargo support through Right of First Refusal (RoFR). Besides this, Government has taken a policy decision to allow shipping enterprises based in India to acquire ships abroad and also flag them in the country of their convenience. As a step towards promoting “Ease of Doing Business” methodology for computation of period of stay of seafarers in India has been redefined.

Major ports are regularly enhancing their capacity by means of mechanisation, capital dredging, rail-road connectivity and capacity augmentation projects both through PPP mode and internal resources. In 2015-16, 70.56 million ton capacity has been augmented in Major ports out of which Chennai Port’s share is 5.00 million tons.

The Indian shipbuilding industry had a share of 1.24%% in 2007 in the global order book, which has shrunk to 0.1% in 2014. To counter cost disadvantage vis-a-vis imported ships, Government on November 24, 2015 has exempted customs and central excise duties on inputs used in shipbuilding. Government has recently decided to (i) extend financial assistance for Indian shipyards equal to 20% of the lower of the “Contract Price” or the “Fair Price” of each vessel built by the shipyards for a period of at least ten years commencing from 2015-16. (ii)Revision of domestic eligibility criteria to ensure that all the government departments or governmental agencies such as CPSUs procuring vessels for governmental purposes or for own purposes shall undertake bulk tendering for their vessel related requirements with deliveries starting from 2017-2018 with a Right of First Refusal (RoFR) for Indian shipyards and shall ensure that from 2025 onwards, only Indian-built vessels are procured for governmental purpose or for own purpose. Further, The Institutional Mechanism on Infrastructure has recommended inclusion of shipyards as “Infrastructure”

This information was given by Minister of State for Shipping, Shri Pon. Radhakrishnan in a written reply to a question in the Lok Sabha today. 
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Paradip Port Mechanization 
The project of mechanization of EQ-1,2,3 berths at Paradip Port on BOT basis has been awarded on 29.02.2016 to a consortium comprising M/s. JSW Infrastructure Ltd. and M/s. South West Port Ltd. The project would increase coal handling capacity from existing 7.85 million tonnes to 30 million tonnes. The project envisages complete mechanization of the EQ-1,2,3 berths including the receipt of thermal coal through track hopper conveying to stack yard and shipment through ship loader using conveyor. Duration of completion of the project is about 4 years from the date of award.

This information was given by Minister of State for Shipping, Shri Pon. Radhakrishnan in a written reply to a question in the Lok Sabha today. 
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Procurement of Cargo Handling Equipments at Port Blair 
The Ministry of Shipping has procured cargo handling equipments for several islands under Andaman & Nicobar. This procurement is part of a project that was initiated in December 2014 to procure cargo handling equipment for various islands at a cost of Rs. 39.02 with a completion timeline of 36 months. The proposals consisted of procurement of cargo handling equipments at Portblair, Mayabunder, Kamorta, Katchal, Rangat, car Nicobar, Diglipur Islands and Janglighat harbour. Out of the above, cargo handling equipments have been commissioned at Mayabunder, Kamorta, Diglipur and a few at Port Blair.

Equipments already procured and commissioned are:

1. One Tyre mounted mobile crane to handle 30 ton at 3 meter radius at Mayabunder in A&N Islands.

2. One Tyre mounted mobile crane to handle 30 ton at 3 meter radius at Kamorta in A&N Islands.

3. One Tyre mounted mobile crane to handle 22 ton at 3 meter radius at Diglipur in A&N Islands.

4. One 20.9 MT pick & carry mobile crane of 30 ton capacity at 3 meter radius at Port Blair in A&N Islands.

5. One truck mounted mobile crane to handle 40 ton at 3 meter radius at Port Blair in A&N Islands.

6. Seven Nos. of 10 ton capacity forklifts at Port Blair in A&N Islands

The contracts that have been awarded and are expected to be completed shortly are as under.

7. One crawler crane for handling 75 ton at 3.67 meter radius at Rangat in A&N Islands. (work commenced to be completed by December, 2016)

8. One crawler crane for handling 75 ton at 3.67 meter radius at Car Nicobar in A&N Islands. (work commenced to be completed by December, 2016)

9. One truck mounted mobile crane to handle 30 ton at 3 meter radius at Rangat. (work commenced to be completed by August , 2016)

10. Two 40 ton trailors at Port Blair in A&N Islands. (Work has commenced, to be completed by July, 2016)

11. One 20 Ton tractor and one 20 ton trailor at Port Blair in A&N Islands. (Work has commenced to be completed by April 2016)

12. One aerial lift of working height 20 m with all accessories at Port Blair in A&N Islands. (Work has commenced to be completed by June 2016)

13. 5 manual spreader for handling 20 feet containers and 2 manual spreader for handling 40 feet containers at Port Blair in A&N Islands. (Work has commenced to be completed by April, 2016)

14. One 625 KVA acoustic enclosure disel generating set with AMF panel at Port Blair in A&N Islands. (work commenced to be completed by April, 2016)

15. One centre lathe, one hydraulic controlled power hacksaw machine, one bench grinder, one radial drilling machine and one 10 ton EOT crane at Port Blair in A&N Islands. (work commenced to be completed by April, 2016)

16. One 6 ton ELL wharf crane (confirming to class III-IS 4594/IS 807) at Junglighat Harbour, Port Blair in A&N Islands. (work commenced to be completed by May, 2017)

17. One Tyre mounted mobile crane to handle 30 ton at 3 meter radius at Katchal in A&N Islands (work commenced to be completed by August 2016)

18. One Tyre mounted mobile crane to handle 30 ton at 3 meter radius at Portblair in A&N Islands (work commenced to be completed by August 2016)

Apart from the above mentioned equipments, Andaman Lakshadweep Harbour Works is also acquiring two tugs at a cost of 63.55 crores which will be acquired by October, 2016. These tugs will help to facilitate the berthing operations. 
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No objection to the proposed change in shareholding in the Container Terminal Projects of M/s. Dubai Port World Limited in major Ports 
The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval for grant of ‘no objection’ to the proposed change in shareholding in the Container Terminal Projects of M/s. Dubai Port World (DPW) Limited in major Ports. It allows for the creation of an Indian holding company of DPW with unique asset portfolio to operate and manage the terminal operations at the existing major ports subject to certain safeguards.

The decision will promote Foreign Direct Investment and private sector participation in the port sector.

DPW Limited is contemplating restructuring of its assets in India with the objective of consolidating the ownership of its port infrastructure in India into a single holding company namely, Hindustan Ports Private Limited (HPPL). The New Company will take over all liabilities of the existing subsidiaries of DP World in relation to the Concession Agreements. here would not be any change of ultimate beneficiary and the ultimate legal and beneficial ownership which will continue to remain with M/s. D.P. World. It is noteworthy that FIPB has given its clearance to D.P. World. The proposal of DPW is intended to help them to expand the capital base and enable fresh investments in Ports and logistics infrastructure in India. This will enable efficient access of finance and introduce latest technology in port operation.

The Government has agreed to the proposal for restructuring by DPW subject to the condition that the net worth of the holding company HPPL after acquisition of the shares of the project SPVs shall be higher than US $ 80 million.

The restructuring of its assets of DPW in India will help in better coordination and control as the Port Authorities have to deal with a single company registered in India. The approval of consolidation proposal of DPW will also facilitate promoting foreign direct investment in the country and signal the investor friendly ambience in the port sector. This may also lead to greater transparency and better compliance to Indian laws and regulations. 


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