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Hooghly Dock and Port Engineers plans JV to counter disinvestment

Company is confident request for quotation for JV will attract both global and Indian firms, once floated

Avishek Rakshit  |  Kolkata 

Shipping

With the union ministry serving an ultimatum to the sick Ltd (HDPEL) in West Bengal to either float a joint-venture (JV) company next year or face disinvestment altogether, Manish Jain, chairman of the state-owned shipbuilding firm is confident of getting a private partner to continue its existence.

Dwelling on the company's total 800-metre waterfront in Nazirguange and Salkia in the state, the the necessary equipment at its command to take forward manufacturing activities, he said the request for quotation (RFQ) for the JV will attract both global and Indian once it is floated shortly.

"All we need is a partner company which has a technological edge," he told Business Standard.

According to the senior official, with the Indo-Bangladesh maritime traffic (cargo and passenger vessels) poised to increase momentously in the forthcoming years, Indian watercraft producers will have to compete with international manufacturers -- who will pitch for their vessel sales in Indian waters -- making indigenous technological edge a prerequisite.

"If we need to handle more cargo in inland waters as well as increase the Indo-Bangladesh maritime traffic, we need to have the latest technology," he said.

Under the scheme of plans, while HDPEL will become a shell company, the JV will take over the ship construction, repair and related activities and operate on 30 acres of leased land and other assets from the sick public sector undertaking.

The indisposed shipbuilder has already completed an internal survey about the strengths and potential of the planned JV where the government will have a 24 percent stake implying increased control for the private partner entity.

It will also help in promoting tourism in the inland and coastal waters.

In June this year, prime minister inked an agreement with Bangladesh on coastal for two-way trade through ports and renewed the 1972 Protocol on Inland Waterways Transit and Trade which uses the two countries' waterways for commerce.

Officials in the country's eastern docks are thereby expecting the traffic to surge in the coming days.

Asked about the interest the move will generate from the private shipbuilding sector in India, P. R.

Govil, advisor to the Shipyards Association of India told this newspaper, "The equipment at HPDEL is too old and there needs to be a concrete policy on shipbuilding from the centre."

He said private majors in the area like Pipavav Defence & Offshore Engineering Company, L&T Shipbuilding, and others would not be interested to participate in the forthcoming tender.

Nationalised in 1984, HDPEL have been suffering recurring losses for the past ten years.

In September this year, the centre moved ahead with the innovative restructuring proposal carrying the ultimatum while improving the voluntary retirement scheme (VRS) -- based on IDA 2007 linked pay scale -- for the shipbuilder's employees.

So far, of its 314 workers, 80 have opted for the scheme.

"Employees have to opt for the improved VRS by January next year. The union ministry will thereafter decide the fate of those who will did not choose the scheme," an official in the state-owned company said.

First Published: Mon, December 07 2015. 18:30 IST
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