SCI to buy four vessels for US and Europe operations

New Delhi, July 13 (UNI) Shipping Corporation of India (SCI) will purchase two 4003 TEU ships and two 5000 TEU ships with an estimated investment of 60-65 million dollar per ship by July next year.

''The ships will replace the existing chartered ships operating in Europe and US sectors. Presently, three ships owned by SCI are operating in South-East Asia and China,'' SCI Director SS Rangnekar told UNI.

Shipping major is also interested in the container terminal at Jawaharlal Nehru Port Trust (JNPT), for which they have submitted expression of interest.

For shipping, logistics is a backward integration, but for container services it is a neccessity as they are expected to provide end-to-end logistic solutions rather than support out port-to-port facilities, Mr Rangnekar added.

When asked about the ship charter rates, he said that the rates have come down by 20-40 per cent since last year and are firming up now. The charter trade will expand further registering a 16 per cent compounded growth, he added.

SCI's capital expenditure for the current fiscal is pegged at around Rs 1800-2000 crore targetted at huge investments in shipping, replacing ageing ships and turning it into a high-tech industry.

The company will add another 70 vessels in its fleet by 2012 with an investment of Rs 16,000 crore.

Meanwhile, Mr Rangnekar stressed the need for better connectivity of ports to bridge the demand-supply gap while addressing a conference on 'containerisation for trade momentum' organised by CII here.

He added that the cost of shipping needed to be brought down. It was 10 per cent of the total cost of trade now, but should be 4-5 per cent. Railway transport costs were also high, at 7 cents per kilometer whereas it could be reduced substantially.

India could look at feeder ships as a business opportunity in future, Mr Rangnekar said adding that the first rung would comprise of super ships and the second would have large cargo ships.

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