Defence Ministry may award Rs 50,000 crore projects to Shipping Ministry

MUMBAI: In what could be a major boost for shipping sector, the Defence Ministry is awarding projects worth Rs 50,000 crore to Shipping Ministry, which would rope in private players for some pojects through Cochin Shipyard.

"We are signing an MoU with the Ministry of Shipping to ensure that the orders which are there with the Defence Ministry could be shared comfortably with the private shipyards through Ministry of Shipping," Defence Minister Manohar Parrikar said on the sidelines of maiden Maritime Summit here.

Later, Road Transport, Highways and Shipping Minister Nitin Gadkari said order from the Defence Ministry could be in the range of about Rs 50,000 crore.

"We have discussed that Defence Ministry will provide Rs 50,000 crore work order to Cochin Shipyard. Cochin Shipyard in turn will award some of the projects to private sector," Gadkari told PTI.

The Shipping Ministry is collecting all orders from Government of India which includes order for nine LNG ships worth Rs 18,000 crore and private sector will be roped in for the some of these.

He said private shipping players were passing through a difficult phase and the orders would provide some relief to them. Government had held a meeting of the bankers and shipping players to solve their problems, Gadkari said.

Earlier, Parrikar said private sector would be roped in through the Ministry of Shipping as Defence has several criteria which are hard to meet by private players.

"There is another government department which can act as cushion. We can order allotment of some order to private shipyard. With shipping ministry it would be another government department. We can work out some orders or some work that can be given to private ship yards through ministry of shipping and this is what MoU is," Parrikar said.

"This is an experiment being done so let us start somewhere. The minister(Gadkari) is very positive, I am ready to provide support. So let us start with something," he added.