A matter of great national importance has been revealed by a prominent media house publishing from Mumbai. And if there is an iota of truth, it is of great significance for the entire nation. But many have given it a Passover. Whether out of ignorance or deliberately, will be known as things roll out, in days to come.
Many Oil & Gas industry followers are aware that the country imports most of its crude needs and for this purpose huge crude carriers called VLCCs are used. Billions of Dollars are spent on hiring these carriers and the private ship-owners call the shots. The nation has to pay through its nose for the transportation costs of crude oil and is often required to heed to the whims and fancies of the global shipping industry.
Associated are the Insurance Companies who extract their own pound of flesh. Many in India are not aware that most of the so called sanctions imposed by the west, on crude purchases by countries like India, are actually given effect to by the Insurers. The insurance companies simply refuse to insure sanctioned cargos. No ship would essay a journey from any port, without the goods it carries, being insured.
Therefore, these insurance companies actually run the Oil transport industry in tandem with ship-owners. Therefore, many countries would like to own its own crude carriers to avoid the pincer hold of private ship-owners and marine insurers. India has a moderately large ship building industry and is known to produce merchant as well as war ships. The matter regarding ownership of Crude Carriers by India is but a logical step towards Energy Independence.
It appears that recently Indian Oil Corporation was entrusted as a common nodal agency to float tenders for the Medium Range Tankers (MR Tankers) on behalf of itself and BPCL & HPCL. The tenders were to be out by June as per instructions from PMO. In order to assist IOCL, a Technical Committee was reportedly set up and specs for MR Tankers with a draft tender, ship procurement documents etc. were sent to IOCL.
IOCL however has yet to issue the Tender. A source informed the media house that IOCL is trying to play safe. The local ship owners lobby also does not seem to favour Oil Companies sourcing MR Tankers from local ship yards. It has even said that there are sufficient MR Tankers already available under the India flag. Many say this is just to counter the fear of losing business.
The Tender it appears is for 10 MR Tankers which are part of 112 Tankers which the Oil Companies say they would require over 15 years. India is said to spend 75-80 Billion Dollars a year for hiring ships from foreign ship-owners. By asking Oil Companies to encourage local ship building, Govt. feels that subsequently foreign ship builders may also set up shop in India.
This type of government support is what makes for an organic economic growth. Building up infrastructure for itself and then for the world would go a long way in making India Energy Independent. It would not then be at the mercy of sanctions and upheavals in the Oil & Gas Market. Oil & Gas sector will continue to dominate Indian economics for some time to come. The steps taken now will help in consolidating India’s future. Geopolitical necessities of War, Calamities, Epidemics and Ecological challenges can be met only if India marshals all its resources. India has to find its position in global ship building and ownership. It cannot be allowed to be sacrificed at the narrow alters of private enterprise alone.
Then this is where real leadership must show its mettle. There is sometimes a great hue and cry about PSUs being given the short end of the stick but it also needs to rise upto the occasion and help in Nation Building. PSU leadership must show that it is not there merely to carry out dictates but is able to take decisive business decisions. This unprecedented and welcome initiative of the PMO and MoP&NG needs to go full throttle. Corporate leadership is honed out of challenges like these. If PSUs have to regain their lost glory this is the time.
