Indian shipowners in expansion mode

The state-owned Shipping Corporation of India (SCI) will seal a deal later this month to r acquire six ships at an estimated total cost of over $1 billion. Sources close to development said SCI has plans to acquire 35 more vessels, which requires an investment of $1.3 billion. The company has already placed an order for two very large crude carriers with a Korean yard for $262 million and delivery is expected by the end of 2008.

Analysts say the Indian shipping industry is seeing a rush to acquire new vessels and shipowners have set aside $2.8 billion in tonnage tax reserve for acquisitions in the next two years.

Varun Shipping plans to invest about $98 million by end of current fiscal year to acquire vessels for its offshore activities including oil rigs and infrastructure facilities to support the offshore exploration activities. Mercator Lines will also acquire three chemical tankers being built in a Korean shipyard for $65 million. The ships are expected to join the company?s fleet in 2008. H K Mittal, chairman and managing director of Mercator Lines said, “Acquisitions are a steady process and we are looking for profitable ventures in the shipping business.”