The Bangladesh Shipping Corporation (BSC) has started building six ships much ahead of signing of a deal with the Chinese financier allegedly to escape meeting compliance requirements, sources said.
A delegation, led by BSC managing director H R Bhuiyan, attended the 'keel-laying' programme in Jiangsu Yangzijiang shipyard. Keel-laying is the formal recognition of the start of a ship's construction.
The state-owned corporation had signed a commercial deal with the China National Machinery Import and Export Corporation (CMC) on April 30, 2014 for buying six vessels at a cost of US$184.50 million. It was agreed that the Chinese Exim Bank would provide finance to the BSC for the procurement of the ships.
However, the BSC is yet to sign a financial deal with the Exim Bank to get the loan because of various complications. The Economic Relations Division (ERD) has long been negotiating with the bank for the loan deal.
Sources said two months back, the CMC informed the BSC that keel-laying of the vessels needs to be done immediately to avoid new compliance requirements set by the International Maritime Organisation (IMO) to be enforced from the very first day of 2016.
The new requirements include environmental and safety related compliances which, the BSC was told, will raise the construction cost of the vessels.
However, a senior official at the ministry of shipping told the FE that there is no possibility of cost increase of the vessels due to compliance with new IMO requirements.
He said the BSC had signed the commercial deal with the CMC nearly two years back. Since then price of vessels has gone down by 5.0 per cent per annum due to low global demand of ships.
BSC managing director Mr Bhuiyan told the FE that officials from the Lloyd's Register Marine, the CMC, and the Chinese Exim Bank were present during the keel-laying of the vessels. The Lloyd's is responsible for monitoring the construction quality and provide classification certificate.
He said due to 'technical reason', the keel-laying had to be completed before December 31 last.
Asked about the shipyard where the vessels are being built, he said, "It's really a big and high-ranking shipyard."
Replying to a query, he said the ERD is negotiating with the Exim Bank on conditions of the financial contract. "Presently, most of Bangladesh's financial deals with China are found to be completed slowly," he said explaining the reason for delay in signing the financial contract with the Chinese bank.
Mr Bhuiyan said the BSC is really in need of vessels to carry out its responsibility. It is now running with a very small number of carriers.
"The cadets of the Marine Academy even fail to complete training due to dearth of the BSC's vessels," he said.
Established in 1972, the BSC is entrusted with the responsibility of carrying bulk cargo, food grain and crude oil, chartering, tramping and feeder services, unloading and providing agency service and ship repairing.
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