Chinese firm offers to build dredgers

Chinese firm offers to build dredgers

Bangalore: A Chinese shipbuilder has taken Dredging Corp. of India Ltd (DCI) and the shipping ministry by surprise by offering to build two dredgers at half the price quoted by a Dutch firm.

The unsolicited offer made by AJ7 Global Group Co. Ltd has now made uncertain the ministry’s proposal to seek Cabinet approval to buy two dredgers—used for deepening and maintaining channels of ports and harbours—from IHC Holland Merwede BV that would together cost Rs1,047 crore, two people familiar with the development said.

IHC, the world’s biggest dredger maker, was the only bidder that qualified for DCI’s tender to construct three dredgers. AJ7 did not bid for the tender. The purchase plan was later scaled down to two firm and one optional order. The proposal to buy two dredgers has been cleared by the finance ministry.

A spokesman for DCI, India’s biggest dredging contractor, declined to comment. AJ7 could not be reached for comment.

Besides the lower price, the Chinese firm has also offered to construct and deliver the dredgers much sooner than IHC.

“DCI did not get the benefit of price comparison in the tender because of the presence of a single qualified bidder," a shipping ministry official said on condition of anonymity.

DCI has been looking to expand its fleet for eight years with little success. Lack of adequate dredgers on its fleet has clipped the state-run firm’s ability to take up more contracts. Currently, DCI has a fleet of 12 dredgers with a capacity to dredge 80 million cubic metres of materials from the ocean bed in a year. The firm is looking to boost the capacity to 100 million.

DCI last purchased a dredger in 2001. A new dredger ordered in 2006 and under construction at state-owned shipyard Mazagon Docks Ltd has been delayed; it was scheduled for completion in December 2007.

The dredger is being built at Mazagon Docks under the supervision of Vosta LMG GmbH, a German firm.