Stop privatisation of Shipping Corporation of India Ltd.

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Shri Narendra Modi Ji,

Hon’ble Prime Minister of India,

We Indians are fortunate to have a Prime Minister like you, who has dynamic leadership qualities and clear vision for the development of our countrymen. A truly People’s Man, who has articulated thoughts to reach every Indian citizen. We all heartly appreciate your efforts and initiatives like Digital India, Make in India, Swachh Bharat, India Maritime Summit and so on, which have potential to transform the nation.

As appearing from media reports that a Panel of Secretaries on 30.09.2019 approved the Privatisation of SCI and three other PSUs – BPCl, THDC India and Neepco with the sale of 30% Govt. equity stake of CONCOR.

SCI has been considered for strategic sale, which has pained one & all in SCI and affected the morale of all employees. At the juncture of stand-offs between the nations and rise of military confrontations; SCI’s existence as a public sector is of utmost importance and we are proud to be the second line of defense.

The Shipping Corporation of India (SCI), a Navratna Company, is the pride of our country. The SCI has immensely contributed to the growth of India’s Exim trade and has been bringing in valuable foreign Exchange.

SCI, a rich legacy with a shipload of Indian Maritime history, is India’s sole National Carrier which has its presence globally at every strategic business hubs across. A Navratna PSU, to be called India’s second line of defense (evident during Gulf war of 1990, Yemen Evacuation in 2015).

SCI was involved in IPKF operations in Sri Lanka for troop movement deploying its vessels. SCI was also involved in Tsunami Rescue and Rehabilitation operations.
It is a matter of pride to state that SCI is the single largest Indian player in Indian Maritime industry with 5.68 mn dwt; contributes to about 30% of Indian tonnage. Since 1961, SCI’s Gross Tonnage has grown 22.73 times with CAGR of 5.74% vis-a-vis Indian Gross Tonnage grew by 14 times with CAGR of 4.88% since 1961.

In the case of any war like situation, private/foreign ship owners may demand exorbitant charter rate for the basic necessities of our country. The energy requirements of India would be in jeopardy. Being national flag carrier, only SCI can assure of providing unhindered support in case of any distress.

Major chunk of SCI’s fleet profile is Liquid Bulk carriers i.e. Tankers. As India’s dependence on importing of crude is around 84% and about 229.54 million MT of crude was imported during the FY 2018-19; these SCI Tankers plays very crucial role for the energy needs of our country.

Similarly, India has imported around 233.56 million MT of Coal and Coke during the last financial year. Again, SCI has 16 Dry Bulk carriers i.e. around 24% of the Indian fleet in Bulk carriers segment; plays a vital role in transportation of Indian coal imports. India’s import requirement of coal is expected to grow with commissioning of coal based power plants in future, in line with Government of India’s initiative of “Power for All”.

Shipping being highly capital intensive industry, with weak freight markets, many players like Varun shipping, GOL Offshore, Mercator, Allcargo Logistics, TAG offshore, etc. were phased out over the period of time from Shipping. The recessionary trend of 2008 has impacted Indian maritime in a manner that the effects are still felt with the lowest freights. SCI has experienced all these bad periods and stayed afloat in every given scenario of highs and lows with flying high India’s Flag at all times.

It is matter of pride that SCI has 60 owned vessels as on date and another 51 managed vessels from various government organisations with great presence for A&N administration ships. The inter-island connectivity and livelihood of the local public of A&NA is dependent on the vessels which are under the management of SCI. SCI has been managing these vessels with a negligible and sometimes negative margins.
Further, SCI has been providing consultancy services to various government departments & agencies in Shipbuilding (viz., A&NA, UTLA, GSI, etc.). Presently, lots of Shipbuilding projects are actively being pursued by SCI for successful delivery of vessels. The consultancy charges compared to the value of the projects are very minimal.

SCI’s sovereign nature has been promising with many sensitive projects being held from time to time viz. (a) storage duty in Bombay high, (b) managing ONGC’s Multipurpose Support Vessels from decades, (c) providing support services to the projects of DRDO, Indian navy & MARS mission, (d) consultancy project for ferry services at Unity of Statue (Kevadia), (e) consultancy services for ferry services from Nariman Point to coastal suburbs, (f) Carriage of defense cargo from foreign lands; and so on.

The education wing of SCI i.e. Maritime Training Institute (MTI) has played crucial role in nurturing Seafarers from 1987; India now provides around 9.35% of the global seafarers and rank third in the list of the large seafarers supplying nation to the world maritime industry. In 1989 Maritime Training Institute became branch of World Maritime University.

Presently, SCI has directly employed more than approx. 5000 employee in Shore and on SCI fleet; and supporting their livelihood; the privatization would directly impact each of these employees and their families.

SCI has been dealing with small/regional vendors including MSMEs (who are backbone of Indian economy), adhering to the govt. guideline in allocating the works to MSMEs; this would definitely hurt, if SCI is privatized.

SCI has been the law abiding and Tax-paying company (even if the company was in continuous losses, taxes are applicable under Tonnage tax system); it never indulged in manipulation of taxes thus contributing to the nation building.

It is further added that thousands people are directly and indirectly employed with SCI and the decision regarding disinvestment will directly affect them & their dependent families severely.

After Privitisation employee job security will be at stake, service condition will change, salaries will be affected and attrition will be inevitable. Permanent workers will be replaced with casual contact workers for profitability.

Development of Human Capital will be curtailed. Reservation policies will not be adhered. Social cause will be at stake with unemployment will be on rise.

Welfare of Public at Large will be at least priority rather it may be overlooked.
SCI is the only PSU in its segment with diversified fleet strength and global reach in the most strategic business hubs of the World Maritime. Given the strategic emphasis of SCI, Indian Maritime will be left with monopolistic condition post disinvestment.

In view of the above we humbly request your good self to re-consider the decision of Strategic Sale of SCI as it is the largest Indian Shipping Company and the only National Carrier of India.

Please Stop Privatisation of SCI, the Largest Shipping Company of our Country, National Flagline Carrier -SAVE SCI.

Jai Hind.