Ship-breaking industry near Kakinada recommended

National Ship Design & Research Centre submits report on location

The National Ship Design & Research Centre (NSDRC) has recommended the 7-kilometre stretch from Vakalapudi Light House to Uppada village near Kakinada in Andhra Pradesh for setting up ship-breaking industry. Based at Visakhapatnam, NSDRC is an autonomous society under the Ministry of Shipping, Government of India.

The design and research centre has recently submitted its techno-economic feasibility report to the Andhra Pradesh government projecting a reasonable scope for ship-breaking operations at the proposed location.

Eager to facilitate the labour intensive ship-breaking operations at Kakinada, which has a brief history of such activities before it came to a standstill due to environmental concerns, the state government entrusted the task of suggesting an ideal location to the NSDRC a couple of months ago.

NSDRC was asked to take into consideration concerns such as environmental impact and threat to livelihood of fishermen along with the analysis of business trends up to 2020.

NSDRC also studied the global scenario and observed that the entry of China into ship-breaking activities will in no way impact the present and future prospects of the industry in the country.

Considering the oceanographic factors like availability of depths at the shoreline, gradient on the beach front, land availability and tidal conditions, the research centre suggested that ships with an average size of 5,000 LDT (light displacement tonnage) could be considered for breaking at Kakinada. The maximum size of a ship that was broken at Kakinada was of 6,430 LDT.

NSDRC in its report suggested that the minimum average size of a plot for undertaking ship-breaking operations should not be less than 80 metres on the seafront, ie, 80x60 metres.

For smooth operations and to minimise pollution and hazardous aspects, the research centre has also indicated that the total number of plots to be allotted initially should not exceed 20.

"Taking into consideration, two thirds of the capacity of the proposed complex will be utilised in the first five-year period, ie, two ships per plot are expected to be broken. Thus, the total number of ships required per year will be 40 of 5,000 LDT each. The availability of 40 ships at Kakinada will be fairly positive and the project could be implemented if all other initiatives are taken care of with regard to pollution, human aspects of safety and welfare measures," the report said.

Based on an estimated employment potential of 300 jobs for an investment of Rs one crore each in ship-breaking, the report calculated that over 3,000 skilled and semi-skilled people are expected to receive direct employment.

An indirect employment to about 2,500 people apart from 300 jobs by the supporting industries such as LPG and oxygen plants, over 200 jobs from material handling, over 1,200 jobs from the re-rolling mills and another 800 jobs from scrap processing and other sundry activity is expected to be generated, the report said.

By considering the minimum stipulated ship-breakage of two lakh tonnes by the proposed 20 units, and the earnings per tonne of LDT ranging between Rs 1,000 and Rs 2,000, the total revenue to the government exchequer in a year is estimated to be around Rs 20 crore.

It may be noted that the employment generation and the subsequent economic activity expected to come up on account of ship-breaking industry in the surrounding areas of Kakinada are much more significant than the revenue.

The centre studied three areas for the possible location "� anchorage port to Vakalapudi, Vakalapudi to Uppada and Uppada to Venkatapuram "� and identified Vakalapudi to Uppada as the most suitable location.

According to the report, fishing activity in this place is very negligible and there are no fishermen settlements or human habitation around three km radius of the stretch.