In its latest move the state-owned Bangladesh Shipping Corporation (BSC) is trying to procure six feeder vessels under a proposed Chinese loan and a mother tanker under PPP for balancing and modernising the national fleet.
Under the replacement and expansion scheme the management of BSC last month sent a proposal to the ministry of shipping (MoS) for procurement of two bulk carriers of 30,000 to 35,000 DWT (dead weight tonnage), two product carriers of approximately the same tonnage and two container feeder vessels of 1000 to1200 TEUs.
The latest proposal to procure six ships was sent to the ministry last month which has already been forwarded to external resources division (ERD), officials in the BSC said and hoped that the project will get government nod at the earliest to be followed by a government-to-government signing of a memorandum of understanding (MoU) with China.
They said the project is expected to get early clearance because prices of second-hand ships in the global market are in a downward trend now-a-days as the international shipping business is in a very bad shape being due to global economic recession, fuel price hike and other reasons.
Executive director of BSC Md Mostafa Kamaluddin
has said that the national flag carrier has no container feeder in its fleet and hence is lagging behind its competitors in local and global shipping business. "We're trying our best to fight out the adversaries through balancing and modernisation of the fleet. This time we are hopeful," he said.
He told the FE that the shipping business worldwide is in bad shape as the cargo fare, for example, per trip between Bangladesh and China has come down to US$ 22-23 per ton in 2012 from US$ 27 in 2011 while the price of fuel has increased this year to US$ 791 per ton from $ 460 per ton in 2011.
Officials said the BSC has also moved ahead with a scheme to acquire a mother tanker for transportation of fuel for national petroleum sector under public private partnership (PPP).
Bangladesh Shipping Corporation procured its latest bulk cargo vessel MV Banglar Shikha in 1991. Since then the national flag carrier could not add a single ship to its fleet in the last 20 years.
In December, 2010 the BSC board of directors chaired by Shipping Minister Shajahan Khan moved to purchase a container feeder vessel and disposal of two age-old general cargo vessels Banglar Urmi and Banglar Gourab procured in 1982 and 1984 respectively.
BSC officials said the decision to sell off two vessels and procure a container of 700 to 750 TEUs (twenty feet equivalent unit) from sale proceeds of the older ones received government nod but it was finally dropped as the management backtracked at the last moment.
The BSC was running short of fund for a long time to procure a container feeder but recently it has accumulated Tk 3.137 billion by selling shares through public offering (IPO), assistant manager (admin and PR) of BSC Md Nasir Uddin Chowdhury said.
The BSC has been incurring loss for the last two decades due to over-age of 28 years on average of 13 ships in its fleet as it is spending a huge amount on repair. Seven ships out of 13 remain in the dry dock and maritime workshop for most part of the year.
Shipping experts said the BSC authority is bored with the burden of age-old, inoperative ships but no one in the management comes forward to shoulder the risk of selling out the old ships for fear of corruption allegations in the deal of disposal.
An official requesting not to be named said, "The authority formed a Condemnation Committee of seven members with Technical Director of the BSC as its head to launch the disposal of very old ships for procurement of new ones but the committee was finally deactivated for reasons best known to them."
The Sena Kalyan Sangstha took two ships Banglar Urmi and Banglar Gourab on hire for US$ 500 per day per ship in 2011 but they returned the ships to the BSC after six months as they could not make the ships commercially viable in spite of spending a good amount of money for repairing.