India’s Shipping Corp considers container business exit
India’s state-run Shipping Corp is believed to be considering an exit from its loss-making container shipping business.
Reports from India suggest the Mumbai-based company is under pressure to do something drastic to reverse three continuous years of losses.
Reports in India’s press claim the move comes at a time when the Indian government has initiated a review on the relevance of SCI as a state-run firm.
“The shipping ministry is examining the relevance of SCI in today’s scenario when the private sector is coming in (a) big way to invest in shipping sector,” said a comprehensive action plan for the maritime sector prepared by the shipping ministry, following a meeting between Prime Minister Narendra Modi and shipping secretary Vishwapati Trivedi in June.
The board of SCI is scheduled to meet to approve the company’s results for the three months ended 30 June. India’s biggest ocean carrier is losing money heavily from operating five container ships (it has a total fleet of 72 ships). The losses from this business have only added to the poor performance of its bulk carrier and tanker unit—the main profit centre of the company in the last two years. SCI, 63.75 per cent owned by the government, is India’s only mainline container ship operator servicing the country’s export-import trade. The container shipping business is a part of the liner shipping division of the company.