Joined: 02/Sep/2006
Location: India
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Posted: 07/Aug/2007 at 9:04am
L&T, Essar, Korean major STX keen on setting up shipyards
Indian shipping industry is set witness a lot of action. Shipping biggies like L&T, Korean major STX, Essar, Shapoorji Pallonji and Bharti Shipyard are keen on setting up two mega shippyards at a total cost of over $1.5 billion.
“A single shipyard can handle around 2 lakh dead weight tonnage which is the international standard. Japan and Korea are well equipped to handle such tonnage,” a government official said. The sites identified by the shipping ministry are Kakinada, Ennore and Tuticorn on the east coast and Mundra and Pipavav on the west coast.
The ship-building industry is soon expected to witness boom period as immense growth is happening in the oil and power sector.
"As the refining capacity in the countries increases the demand for crude oil will go up, leading to increased demand for tankers. More and more power generation capacity is being created, particularly thermal power, which will require more coal. As Indian coal has more ash content, coal will be imported in huge quantities, which will require more ships," said a shipping industry analyst.
To bring India at par with Korea and Japan will be a hard task for the government. "If Indian companies ally with Korean, Japanese or other technologically-strong companies, then India may be able to compete with Korea and Japan in the long run,” added the analyst.
Ships over 25 years old to be barred from docking here
The government is charting out guidelines to bar entry of aged overseas ships into Indian coasts. Ships aged 25 years and above may soon be disallowed to dock at Indian coasts.
According to a shipping ministry official, 17,000 ships are overage in the world.
“The idea is to bring a threshold age for the ships. While we will target 25-year-plus ships in the beginning, later even 20-year-old ships will be targeted as the average age of a ship is 17 years,” the official said.
However, experts point out that the move of the government may have multi-dimensional impact. KPMG associate director Bivek Anand says, “The impact on shipping companies will be in terms of the need for expediting their fleet renewal/tonnage acquisition plans, since a number of existing vessels may not qualify on the age meter, for touching the indian coast.”
Many shipping companies globally (and in India) register their ships in countries where the regulatory framework governing the operations of ships, is more lenient and/or commercially more advantageous.
Joined: 02/Sep/2006
Location: India
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Posts: 9319
Posted: 14/Aug/2007 at 7:38am
A much sought after and lucrative subsidy given by the Union government for building ships within India ended at midnight Tuesday. It is not clear whether the subsidy, with a current hefty price tag to the government of Rs600 crore, will be extended in its present form, reintroduced with modifications or even scrapped altogether.
The shipbuilding subsidy scheme, under which shipbuilders get 30% extra on every ship they build of a certain size for the local market and all ships for exports, has already been extended twice.
Shipyards taking new shipbuilding orders from Wednesday would no longer be entitled to any government support unless the scheme is extended in coming weeks and months with retroactive effect.
Partly because of the attractive subsidy, shipbuilders, both existing and new ones, have lined up investments of about Rs10,000-15,000 crore to upgrade and modernize existing yards and set up new facilities to boost capacity.
“In the global scenario, when the rest of the world is supporting or incentivizing shipbuilding, it is important that the Indian government also supports or incentivizes shipbuilding, either through subsidy or some other form such as infrastructure or SEZ (special economic zone) status,” says Dhananjay Datar, chief financial officer, ABG Shipyard Ltd, India’s largest private sector shipbuilding company.
Gujarat, India’s top maritime state by cargo handled at state-owned ports, is finalizing a shipbuilding policy that has set an ambitious target to grab more than half of the country’s shipbuilding market by 2020, an official at the western state’s maritime regulator said.
The state will be the first in the country to have a separate policy on shipbuilding. A draft policy prepared by the government seeks to extend tax holidays to shipbuilding projects for five years.
The government also plans to offer power at concessional rates to entities setting up yards and exempt them from octroi. The government will lease land to such firms.
More than 20 firms have shown interest to set up shipbuilding facilities in the state with investment plans of about Rs11,000 crore , and with a potential for 100,000 jobs. Six firms, including India’s biggest private sector shipbuilder ABG Shipyard Ltd, SKIL Infrastructure Ltd and the Adani Group are in the process of building full-fledged yards at Dahej, Pipavav and Mundra ports respectively. ABG and Larsen & Toubro Ltd currently have facilities to build ships at Hazira.
Jindal Shipyards, a part of the $8b OP Jindal group, is planning to rope in Korean Maritime Consultants (Komac) for setting up the country’s first maritime technology park, expected to draw investment worth $7.2b. The park, to be called India Maritime Technology Park, will come up near Dahej. It will be on lines of Chinese cluster model and will get SEZ status later on. The project will also house a maritime technology institute..
Life can only be understood backwards—but it must be lived forwards
The Tata group has shown interest in building a shipyard near Shivrajpur in Gujarat after the state government invited expressions of interest from private firms, according to a senior Gujarat government official.
Tata Steel Ltd makes steel, a key input for constructing ships. Typically, for making 10-15 ships in a year, a yard would require close to 70,000 tonnes of steel, and steel makers such as Tata Steel, Essar Steel and Jindal Steel are now eyeing the shipbuilding business because the steel they make can also be utilized for constructing ships at their own yards.
Life can only be understood backwards—but it must be lived forwards
As we know that there is a boomin the field of ship design/ building globally also in india. and regarding that i have few queries hope you would like to reply to them, and they are as follows:-
1) is it possible for you to mention the reasons why there is booming?
2) How long will this booming continue?
3) Too many new employee are getting engaged in this field due to this boming. but, wht will happen when there will be no booming? will our ship building industry able to provide job to them with same sort of salary?
About your queries on the Ship-building sector, as per reports & management interviews the boom is likely to sustain for next 4~5 years due to many macro factors.
Life can only be understood backwards—but it must be lived forwards
Joined: 29/Mar/2007
Location: India
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Posts: 4243
Posted: 22/Oct/2007 at 1:00pm
1) Because of certain regulations, all old crude carriers need to replaced with new double hulled ships. Global ship builders like Hyundai/ Mitsubishi have their hands full with these orders. So when something like this happens, orders for smaller ships goes to countries like India.
2) Till supply is able to meet the demand.
3) When there is no boom, the employees will be fired!
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