03JUL2019 - NEWS - Setback for India’s efforts to boost shipping industry.

India’s top refiner Indian Oil Corp is close to chartering a Panama flagged ship rather than an Indian vessel in its first five-year tender to hire an oil tanker with scrubbers that remove sulphur emissions, sources with knowledge of the matter said.

In December last year, state-owned IOC issued a global tender and offered Indian shippers a first right of refusal as the nation seeks to boost its shipping industry. India, the world’s third-biggest oil importer, wants to promote the market share of its vessels in bringing in crude imports.

But the Panama-flagged very large crude carrier (VLCC) Bright Pioneer, owned by Nissen Kaiun Co Ltd, has emerged as the likely winner for a daily rate of $30,000-$32,000, the sources said.

None of the Indian companies could match the bid, they said. “Indian companies declined the first right of refusal,” said one of the sources.

That will be a blow to the federal shipping ministry, which wants the state-refiners to sign five-year contracts with local shipping firms to shift freight worth billions of dollars to Indian flag carriers, including Shipping Corp of India (SCI), Mercator Ltd, Great Eastern Shipping Co and Essar Shipping.