Shipping cos want Rs 10k cr from govt to buy ships

The Indian National Shipowners’ Association (INSA), a representative body of Indian shipowners including Shipping Corporation of India (SCI) and The Great Eastern Shipping Company, has demanded Rs 10,000 crore in soft loans from the government to acquire new assets at a time when ship prices are falling.

“External commercial borrowing has completely dried up,” said S Hajara, INSA president and SCI chairman and managing director, on the sidelines of an industry conference in Mumbai. “Liquidity crunch is a major problem of shipowners worldwide,” he added.

INSA made the demand to the Department of Shipping, which has forwarded it to the finance ministry.

“We are looking for a war chest of at least Rs 10,000 crore,” said Hajara.

Department of Shipping Secretary A P V N Sarma was not available for comment.

Thanks to the ongoing global financial crisis, ship prices have fallen by almost 50 per cent in the dry bulk segment.

Indian shipowners have been losing business as foreign trade grew much faster than the capacity addition by them.

Indian shipowners see this as an opportunity to grow their capacity to get a better share of domestic cargo.