Cochin Shipyard set to get Mumbai Port boost, service around 100 more ships each year
Cochin Shipyard Ltd (CSL) is set to get the lease for Mumbai Port Trust’s (MbPT) Hughes Dry Dock facility as well as four berths at the Indira Dock on Saturday.
Cochin Shipyard Ltd (CSL) is set to get the lease for Mumbai Port Trust’s (MbPT) Hughes Dry Dock facility as well as four berths at the Indira Dock on Saturday. This will help the Kerala-based shipbuilder to service around 100 more ships every year, apart from spreading its ship repair services beyond South India.
The over-a-century-old Hughes Dry Dock facility and the berths at the Indira Dock at the MbPT premises are being given out to CSL for a period of 29 years. The Cochin-based shipbuilder will provide end-to-end ship repair solution to ship owners and use the berths at the Indira dock for deployment of floating dry dock and afloat repairs.
“MbPT will receive annual fees of approximately Rs 14.80 crore with an annual escalation of 2.5%. There will also be a profit share of 5% on profit after tax for the initial period of four years and 7.50% thereafter,” said Sanjay Bhatia, chairman, MbPT.
A Memorandum of Understanding for the same was inked between both the entities in January this year.
As per the arrangement between the two government-owned firms, services of existing skilled employees of MbPT will continue to be utilised by the CSL by way of deputation to CSL. Hence, there would not be any cut down in manpower at the Mumbai-based port. The leased out facilities will be managed and operated by CSL.
Over the last few years, the MbPT has been focusing more on citizen-related services and recreational facilities inside its port premises. As a result, the direct involvement of the port trust towards core shipping and shipping-related activities has been on a decline. For example, the offshore container terminal has been shelved for Ro-Ro (Roll on-Roll off) terminal.
Secondly, the ship-breaking facility, too, is almost shut. Part of the port land is being opened up for ‘port land development’ project, which would have residential and commercial establishments.
The MbPT is also looking at options to generate revenue by leasing out its assets for ancillary services. For example, it has opened up its vacant land within the port premises for Jawaharlal Nehru Port Trust (JNPT), wherein barge operators will take containers from JN Port to berths at Mumbai Port. For now, New Sewree Warehouse at MbPT, spread over 24,000 square metres, has been earmarked for the project
Watch This Zee Business Video Here:
According to CSL, the Hughes Dry Dock, as well as four berths at Indira Dock, are likely to be utilised for commercial as well as defence ship repairs. Other than CSL, Mazagon Dock Shipbuilders Ltd and Garden Reach Shipbuilders & Engineers Ltd are also looking to diversify into ship repairs.
Source: DNA Money
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.