Oil PSUs Invest Rs 170 bn in Mega Shipping JV Led by SCI
PORTS & SHIPPING

Oil PSUs Invest Rs 170 bn in Mega Shipping JV Led by SCI

A consortium of Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) is set to invest in a major shipping joint venture led by the Shipping Corporation of India (SCI). Under the proposed structure SCI will hold 50 per cent majority, the Maritime Development Fund (MDF) will hold 15 per cent and the three oil PSUs will hold a combined 35 per cent stake.

The move is aimed at reducing reliance on foreign-flagged shipping, as nearly 90 per cent of India’s crude imports currently travel on non-Indian vessels. Analysts cited in the release calculated that India spends about $75 billion, roughly Rs 6.2 tn, annually on freight to foreign companies, exposing the energy chain to geopolitical disruptions and soaring insurance premiums during crises. Bringing shipping into a domestic, captive model is intended to retain freight outgo within the national economy and improve supply security.

The joint venture envisages the acquisition or construction of 59 new vessels by 2030 with planned capital deployment of about Rs 150 bn to Rs 170 bn. The fleet will include Very Large Crude Carriers, designated VLCCs, Very Large Gas Carriers, designated VLGCs, product tankers for refined fuels and offshore support vessels to assist exploration and production companies. A significant share of construction is expected to be sourced from Indian shipyards in line with the Atmanirbhar Bharat objective.

Officials described the initiative as a catalyst for reviving domestic shipbuilding, generating thousands of skilled maritime jobs and standardising designs for both commercial and naval requirements. The venture will also need rapid fleet modernisation and a commercial mindset to compete with global operators, while low-cost funding from the MDF will be a key determinant of pace. Sponsors expect the business to reach profitability within three years of full operations, transforming SCI into a strategic logistics asset and improving margins for the oil PSUs.

A consortium of Indian Oil Corporation Limited (IOCL), Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) is set to invest in a major shipping joint venture led by the Shipping Corporation of India (SCI). Under the proposed structure SCI will hold 50 per cent majority, the Maritime Development Fund (MDF) will hold 15 per cent and the three oil PSUs will hold a combined 35 per cent stake. The move is aimed at reducing reliance on foreign-flagged shipping, as nearly 90 per cent of India’s crude imports currently travel on non-Indian vessels. Analysts cited in the release calculated that India spends about $75 billion, roughly Rs 6.2 tn, annually on freight to foreign companies, exposing the energy chain to geopolitical disruptions and soaring insurance premiums during crises. Bringing shipping into a domestic, captive model is intended to retain freight outgo within the national economy and improve supply security. The joint venture envisages the acquisition or construction of 59 new vessels by 2030 with planned capital deployment of about Rs 150 bn to Rs 170 bn. The fleet will include Very Large Crude Carriers, designated VLCCs, Very Large Gas Carriers, designated VLGCs, product tankers for refined fuels and offshore support vessels to assist exploration and production companies. A significant share of construction is expected to be sourced from Indian shipyards in line with the Atmanirbhar Bharat objective. Officials described the initiative as a catalyst for reviving domestic shipbuilding, generating thousands of skilled maritime jobs and standardising designs for both commercial and naval requirements. The venture will also need rapid fleet modernisation and a commercial mindset to compete with global operators, while low-cost funding from the MDF will be a key determinant of pace. Sponsors expect the business to reach profitability within three years of full operations, transforming SCI into a strategic logistics asset and improving margins for the oil PSUs.

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