Week ending June 19, 2002


News on Ports

Port Trust brought under IT purview For the first time, the Visakhapatnam Port Trust will come under Income Tax net following waiver of exemption effected by Finance Act 2002, as per the directives issued by the Chief Commissioner of Income Tax for the region. As per the directive all the local authorities, excluding municipal corpora­tions would have to pay Income Tax. The Vishakapatanam Port authorities have been asked to furnish the finan­cial details pertaining to the last three years and pay the Advance Tax by September 15. The IT authorities have also sought to bring the Dock Labour Board, under the purview for irregularities in filing returns.

Malpe harbour phase II by October The phase II of Malpe fisheries harbour near Udupi is likely to be commissioned by October. The project originally scheduled for com­missioning by March 2000 and estimated to cost Rs 11.96 crore has seen cost escalation to Rs 19 crore due to delay in implementation. The Karnataka state fisheries department initiated the project in early 1997 to pro­vide infrastructural facilities to offshore deep-sea fishing operations but subsequently there were delays due to change in harbour design and slower tendering process. So far, Rs 16.5 crore has been spent on the project, now nearing com­pletion. The project when completed will ease congestion and accommodate around 1,500 mechanized fishing boats. Currently, 800 mechanized boats are operating from Malpe harbour. The facilities being created under the project include 520 metre long wharf, three jetties with length of 140 metres each and 140 metre long berthing jetty, apart from two 1,500 sq. metre auction halls.

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News on Shipping

War-risk premium on case-by-case basis International Under­writers' Association (IUA) has stated that all ships visiting the western Indian ports will face paying a war-risk premium from June 18 but the additional charge will be on a "case-by-case ba­sis". IUA move to impose a war-risk premium had been decided by the London Joint Hull Commit­tee, which brings together rep­resentatives of the Lloyd's of London and the underwriting industry. The IUA spokesman said the war-premium would apply to Indian ports north of 18 de­grees north longitude and west of 73 degrees east. These include the major west coast ports of Kandla, Mumbai, Nhava Sheva ports.

Mercator Line to expand tanker fleet Mercator Lines (MLL) is reportedly planning to acquire tankers, either of the Aframax or Suezmax variety, to double the size of its fleet. The company, which has a sizeable share of the Mumbai's lighterage opera­tions market, has already acquired five tankers in the last six months, to expand its operations. The company has also announced its results for 2001-02, with an impressive 130 per cent jump in net profit to Rs 7.5 crore (Rs 3.3 crore), and a 100% jump in income from operations to Rs. 56 crore, despite what is otherwise regarded as a bad year for shipping companies. The company has major oil companies like Indian Oil and Reliance Petrochem as its clients for lighterage operations.

GE Shipping Q4 net slips, FY01-02 profit up by 17 per cent Great Eastern Shipping saw a 43.6% fall in net profit (after provision for deferred tax) for the fourth quarter ended March 31, '02, down from Rs 54.6 crore to Rs 30.8 crore. Similarly, total revenues for the quarter nose-dived to Rs 2,58.1 crore (Rs 354.9 crore). For the year as a whole, the compa­ny posted a net profit of Rs 207.5 crore (after provision for deferred tax), an increase of 17% compared with the previous year. This is the highest net profit the company has ever recorded. Revenues stood at Rs 1,196.4 crore, a growth of 3.6%. The board has recommended a dividend of Rs 4 per share (Rs 2.75), accounting for an overall outflow of Rs 76.2 crore.

Tuticorin-Colombo ferry service to start by August An inter-governmental group comprising senior officials from India and Sri Lanka is currently finalizing the arrangements for launching the proposed Tuticorin-Columbo passenger service from August. The group would consult with the port officials from Tuticorin and Colombo for creation of necessary amenities. The Tuticorin Port Trust has prepared a Rs. 125 crore scheme for the creation of amenities for passengers and is contemplating further up gradation of facilities like passenger rest rooms at the port, customs & emigration clearance, transportation of passengers and baggage from berth to passenger amenity hall, based on the type of passenger vessels that are likely to be operated. The planned service is expected to be operated thrice a week and the frequency could be increased subsequently depending on the passenger traffic throughput.

SCI to retain its stake in Greenfield ventureThe board of directors of Shipping Corporation of India (SCI) which met on June 18 has decided to continue to be associated with Greenfield Shipping Company, while rejecting requests from consortium partners to further pump in additional $ 33 million as its share of bridge loan for holding a 20 per cent stake in the LNG shipping venture. The SCI board also decided against making any provision in the company books for an amount equivalent to its equity investment of $11 million due to erosion in the joint venture’s equity following the revaluation of LNG Laxmi at $160 million. The board took the view that it was too early to provide for erosion in the value of the 1,37,000 cubic metre LNG tanker built originally for Dhabol Power Company (DPC) for transporting LNG from Oman. Japan’s Mitsui OSK Lines and the government of Sultanate of Oman, the other consortium partners had asked SCI to contribute $ 33 million as its share of a bridge loan to retire the original senior loan of $ 110 million taken from a consortium of banks led by ANZ Investment Bank to fund the construction of LNG Laxmi.


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