SCI plans fleet expansion

Earmarks Rs 6,500 cr for purchase of VLCCs, Panamax and Capesize bulk carriers.

The Shipping Corporation of India (SCI) plans to invest about Rs 6,500 crore over the next few years for acquiring vessels.

"We are supposed to buy 34 vessels by the end of the Tenth Five Year Plan. The fund would be spent on acquiring vessels, including very large crude carriers (VLCCs), Panamax and Capesize bulk carriers," SCI chairman and managing director S Hajra said on Monday.

While the government has already cleared acquisition of the two VLCCs, the proposal for two capesize vessels has been cleared by the Public Investment Board and would be placed before the cabinet soon, ministry officials said.

On its plan to acquire another company, which the board had cleared a few months back, Hajra said the proposal was with the finance ministry.

"Proposals for mergers and acquisitions by a public sector company may require an empowered committee's approval. We have given our proposal to the shipping ministry, which would be pursuing the case further with the finance ministry," he said.

SCI's board had given go-ahead for acquiring a small foreign company.

"This is a means for our inorganic expansion, where one can add to its fleet through acquiring another company," Hajra said.

SCI has also plans to increase its presence in offshore oil segments, he said, adding that the company was aware of the market growth in the sector and could consider joint ventures with for foreign shipping companies.

In addition, SCI is keenly pursuing transportation contracts with newer LNG projects being developed in the country and has targeted LNG shipping as its focus area, he said.

SCI has plans to float a joint venture company with National Iranian Tanker Company, Islamic Republic of Iran Shipping Line (IRISIL) and Irano-Hind Company for carrying LNG and petrochemicals from the South Pars field of Iran.