NEW DELHI, July 1: The surface transport minister TG Venkatraman has announced a set of incentives cleared by the cabinet committee, including a 30 per cent subsidy for shipping industry for attracting private investments.

Talking to the media persons in New Delhi the minister said that the subsidy announced for the shipping sector will be valid for a period of 5 years and is for both the domestic and the international markets. And this raise in the subsidy from 20 per cent which was given by the government and the 10 per cent was to be raised by the owners has put India on the level of Korea, he pointed out.

Venkatraman said that industry's major demands have been approved and that now for the first time the ship builders and industry can go for external commercial borrowing (ECB).

The cabinet has cleared the proposal of the restructuring of the Hindustan Shipyard Limited, which has been pending for 10 years now. "It will now facilitate more joint ventures both domestic and international, while the shipyard had a solid infrastructure, it had been declared a sick unit in the 1980s," the minister pointed out.

Responding to a query about the tie up of HSL with a Norwegian shipyard, Yogendra Narain, secretary ministry of surface transport, said that the yard had tied up with the biggest shipping industry in the world to draw strength from them. While all this is still in the discussion stage, the Norwegian company is ready to take up 40 per cent equity participation in HSL.

The idea is to get more business for the yard and encourage the private investors to come into the shipping sector especially the shipbuilding, the secretary added. About the shipping policy, the minister said that while all the formalities have been completed, the final report has yet to come. The government has also approved acquisition of two 110,000 tonne deadweight double hull Aframax Tankers by the Shipping Corporation of India (SCI) from Halla Engineering and Heavy Industries Ltd, a South Korean company at the cost of $ 42.10 million per vessel.

These tankers are expected to be delivered to the SCI during the second quarter of 1999. The cabinet has sanctioned the project for the modernisation of the Marine Oil Terminal at Jawahar Dweep at Mumbai Port. The cost of the project is estimated to be Rs 167.99 crore and will be a major step for improving the discharge rates of tankers and thereby removing congestion of tankers at the port.

The overall Transfer Rate of crude will immediately double from 2,100 tonnes per hour to 4,250 tonnes per hour and that of products from about 340 tonnes per hour to about 1,650 tonnes per hour. Fire fighting facilities will be set up of internationally accepted standards. The minister announced that the revival of the HSL is going to bring in a lot of business in the country since it is well equipped, and that the yard can also take up the construction of vessels for the defence sector.

The CMD of the HSL, Commander KV Raghavan, who was also present at the press conference, claimed that the shipyard is in a position to build frigates for the Indian navy. He said recently a foreign submarine had undergone massive repair work at the shipyard. Venkataraman said the SCI has an ambitious plan of tonnage acquisition during the Ninth Plan involving 44 vessels of different types with an investment of Rs 4,500 crore. The SCI had placed orders with the shipyard for a 42,000 DWT bulk carrier which is expected to be delivered in August this year. A double hull tanker of 83,400 DWT, is expected to be delivered soon to the SCI. u

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.