Shipping in India

Via Indian Express

Govt to sell minor shares in SCI

While government and stockholders will certainly benifit from it, I dont see any real gain for the company or the country.

Shipping in India is for all purposes government monopoly.
SCI is profitable precisely because it has all the major government contracts.
From whatever little I saw of ONGC or SCI, I was not impressed.

Indeed although not widely recognized shipping has a crucial role in growth of global economy by transporting goods (whether raw materials, finsihed goods or capital goods) .Last year almost 90% of global trade was done via Shipping. Importance of shipping for growth of Indian economy and employment of unskilled and skilled labour can not be overemphasised, unfortunately shipping faces all the road blocks possible.

Shipping is higly protected and for all practical purposes dominated by Government (SCI) with insufficient competition.
The Government monopoly brings with it usual baggabe of vested interest who will be loathe to let go of this golden goose (just like other government monopolies like coal)

Ports have neither sufficient capacity nor efficiency to handle international Cargo. To rub salt over the wound ports are neglected either due to lack of fund or due to familiar bureacratic sloth,red tape and corruption.
There is not enough draught for bigger ships due to lack of dredging, broken cranes.Procedure are impossible to follow opening a convenient window for bribery and making the transactions difficult.

Lack of supporting infrastructue like roads, electricity etc. does nothing to help the cause.

In addition labour environment (frequent labour strikes, rigid labour laws) end up harming shipping.


The other part of shipping is ofcourse ship building.
There also we are missing a golden opportunity for growth and job creation.
Long coastline, cheap labour (skilled as well as unskilled) and comparative ease for technology transfer makes India an ideal candidate for this industry.
However here same culprits (Government monopoly, Bureaucratic sloth and corruption, poor infrastrcutre and unfavourable labour laws) ensure that India has miniscule share (<1.5%) in global shipbuilding industry, in contrast, other asian counteries like South korea(28%),Japan(37%) and China(13%) are leaders.
Major shipyards like Hindustan, Mazgaon, GardenReach or Cochin are goverment owned and hardly inspire any confidence with cost overruns and delays.

These two industries are opportunities waiting to be tapped.
It is up to leaders as well as opinion makers to make it a reality.