Arun Gupta appointed CMD of Shipping Corporation of India

The government today appointed Arun Kumar Gupta as the chairman and managing director of Shipping Corporation of India (SCI), filling the post which has been vacant for over a year.
The SCI said that Arun Gupta, who was the director of offshore services at the city-headquartered shipping line before his elevation, assumed charge as its chairman and managing director from January 28.
After graduating from Marine Engineering College, Gupta joined SCI as an engineer in 1976 and sailed onboard SCI's ships till 1988.
He has been a trustee of Kandla Port and V O Chidambaranar Port Trust, Tuticorin. He is also the chairman of the Institute of Marine Engineers, Mumbai.

Gupta has completed 37 years in the shipping sector, leading and managing challenging projects in various divisions of the SCI.
Last week, the shipping secretary had told PTI that Gupta was shortlisted for the top job and an announcement would be made in a fortnight.

The state-run SCI, which had reported a net loss of Rs 114.31 crore last fiscal, has been without a full time head since S Hajara retired in December 2012, that too after a one-year extension. Its director finance B K Mandal has been officiating as the CMD since then.
The name of its director of bulk and tanker division Sunil Thapar was cleared by the Public Enterprises Selection Board (PESB)in August 2012, to succeed Hajara, but the Central Vigilance Commission did not clear his name. After this, the SCI's director finance BK Mandal, was made its interim chairman from January 2013.

The decision to fast-track the appointment of the new CMD came after SCI's future as a Navratna company was threatened by three years of consecutive losses. As per government rules, PSUs with Navratna status reporting three years of consecutive losses stand to lose their Navratna tag, which would curb their financial autonomy.
The SCI, which owns one-third of the total shipping fleet, has been struggling for the past few years, primarily due to a steep decline in freight rates and oversupply of vessels as the economy is in shambles. Also, unlike many of its rivals, the company failed to tap into the lucrative offshore services sector, which dented its balance sheet.

However, private sector player like Great Eastern Shipping, Mercator and Varun Shipping successfully diversified into allied sectors like offshore drilling and LPG shipment -- something which the SCI is yet to do.
The company has also struggled to take advantage of various MoUs it had signed with large PSUs, including ONGC, Coal India Ltd (CIL) and Steel Authority of India (SAIL), which could have helped it with assured cargo during the downturn in the sector.