CSL had to participate in the open tender and win if it had to get the order
Cochin Shipyard. (Photo: CSL official page)
Kochi: The reported move by the Cochin Shipyard Ltd (CSL) and L&T to jointly build the LNG carrier is sure to undermine the leading PSU shipbuilder’s survival and growth prospects.
As per reports, L&T has proposed to build a dry dock for the Rs 1,500-crore carrier in Chennai and the CSL will offer design and technological support. A CSL spokesperson declined to comment saying it involved the commercial interests of the company.
The CSL, which has not bagged a major order in the last three years, was pinning its hopes on the recent announcement by Union transport minister Nitin Gadkari that the government had decided to indigenously build three of the nine LNG carriers the country needed and that the CSL would get the order for one. However, sources later said there was no such decision by the government and that the CSL had to participate in the open tender and win if it had to get the order.
The CSL has to build a dry dock at a cost of Rs 1,200 crore if it gets the order.
The CSL management has been holding that the company had no money and suggested an IPO to raise the funds. The move, however, was resisted by the employees’ unions which pointed out that the company recorded a profit of Rs197 crore last fiscal and had a cash reserve of Rs 1,300 crore. This would help the company manage the funds without an IPO, they held.
According to sources, the CSL will have to source the technology from abroad if it has to build an LNG carrier. “This is a high-stakes venture and success would mean that the company would have a comfortable order position for at least 10 years,” the sources said.
Trade unions have reacted sharply to the reports. “The management has confirmed that the L&T team had indeed visited the CSL and made a proposal but assured that it would protect the company’s interests,” said Mr G. Vijayan, secretary, Cochin Shipyard Employees Federation. “We expect the LNG carrier to offer us a fresh lease of life. We shall oppose tooth and nail if the management ropes in a private partner,” he said.
Prof K.V. Thomas MP, chairman of the Public Accounts Committee of Parliament which recently visited the CSL, said he would take up the matter with the centre. “We are all convinced that the CSL must get the order and we shall do everything possible to ensure that,” he said.
( Source : dc )
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