SCI SOS

[Pantelis]

SCI SOS

State-owned Shipping Corp of India (SCI) is seeking emergency funding of INR 100bn ($2.05bn) to pay for its big newbuilding programme.

India’s Financial Chronicle cited SCI boss Sabyasachi Hajara as saying its plans to secure new ships have been endangered by the drying up of credit.

"Finance by foreign banks and foreign financial institutes in the shipping sector has virtually dried up because the foreign investors are busy bailing out their own domestic companies. In such a scenario, a large chunk of finance is required by SCI for taking delivery of ships," he was quoted as saying.

And INR 100bn could be only the start. He added: "The government should raise the money through banks or directly through a specific fund for the shipping industry. Incentives should also be given to shipowners at this point of time."

SCI is planning to acquire 40 new vessels – mainly tankers, bulkers and ferries - by 2011 and will require funds of almost $3bn to finance the acquisitions, of which $2bn is needed immediately.

Hajara said: "Non-availability of finance is a great concern for the whole shipping industry now. The issue has already been taken up with the finance ministry at the highest level and we are expecting positive results soon.”

By Gary Dixon in London

fm Tradewinds