Addressing the members of parliamentary consultative committee, Singh said that since LNG was the future fuel, proposed to be imported in large quantities, it offered substantial potential for the shipping industry to diversify and enter new areas of profit.

He said the government was also considering infrastructure status for shipping industry as it contributes about Rs 3,500 crore annually to the foreign exchange kitty. The government was mooting a proposal for introduction of tonnage tax in place of corporate tax as in the European countries.

He said that the Indian shipping lines must not be excluded in LNG transportation adding that shipping majors, who do not have much experience in LNG transportation at present be encouraged to acquire competence in handling the fuel.

The minister outlined several policy initiatives underway to prop up the Indian shipping industry whose growth, he said, had not kept pace with increase in international trade.

Expressing concern at the domestic tonnage registering a negative growth during the last three years due to several reasons, he assured the members that his ministry was actively pursuing the recommendations of the National Shipping Policy Committee. He said since the recommendations had financial implications, inter-ministerial consultations were required even though 15 recommendations of the had already been implemented.

The minister said that the status of mini ratna had been conferred on the Shipping Corporation of India (SCI).

This would help address the problem that its tonnage had not kept pace with the trend in the international cargo market. It would enable SCI to acquire ships without much delay as acquisition decisions involving Rs 300 crore could be taken by the SCI board without referring it to the government.He said that for 2000-2001, the SCI had been given an outlay of Rs 567.01 crore for acquisition of new cargo ships.

On the port sector, the minister said that by the end of the Ninth Five-Year Plan an estimated capacity of 424 million tonne (mt) of cargo was envisaged, resulting in an additional capacity of 159 mt at an investment of Rs 16,000 crore. He said keeping in view the need for capacity creation and huge requirement of funds, it had been decided to involve private sector for the development of major ports.

The minister informed the members that 13 projects for creation of 52.80 mt of port capacity by the private sector and captive-users with an investment of Rs 3,926 crore had already been approved. They constituted one third of the capacity planned to be created in major ports during the Ninth Five-Year Plan.

Another eight projects of 34.4 mt capacity involving an investment of Rs 3,500 crore were under bidding process. Another three projects aggregating to 5 mt capacity at an investment of Rs 450 crore had been identified for inviting bids.

On the demand of dock and port workers regarding the periodicity of settlement of wages and payment of house rent allowance with retrospective effect from January 1, 1998, the minister said that the bipartite wage negotiation committee had held several meetings and a settlement was likely to be concluded shortly.