Back in business
the Union finance minister's (fm's) announcement to restore a five per cent custom duty on the import of steel scrap for melting has given some hope to shipbreakers. The announcement has come at a time when the ailing shipbreaking industry in Alang was striving to get over the setback of the return of French warship Le Clemenceau.
Levying custom duty on melting scrap is going to make its import costlier. This will force the steel re-rolling mills to eye the shipbreaking industry for scrap at a cheaper rate, giving the shipbreakers a competitive edge in the scrap business,' says Vipin Aggarwal, a leading shipbreaker and secretary of shipbreakers' association. There are about 25 steel re-rolling mills in Bhavnagar and Sihor, with a daily production capacity of around 300 tonnes of steel. "With the decrease in number of ships coming to Alang, these mills had turned to melting scrap imported at the Kandla port,' says Mukesh Patel, owner of the Shree Ram group, which is into both shipbreaking and re-rolling industries. And at Alang, it seems fm's announcement has already made an impact. "Ten ships have arrived at the port in the first fortnight of March 2006 and 15 others are expected to arrive by mid April,' says Mehul Mehta, director of mcc Shipping Supply and Services Private Limited.
If the trend continues, the shipbreaking yard will get around 250 ships in the current year
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