The Hindu Business Line : Dredgers seek parity with ships in tonnage tax issue

THE Indian Dredger Owners' Association, an organisation formed to protect and promote dredging business activities in the country, has protested against the exclusion of dredgers from the `qualification of ships' in the Finance Bill, while considering the tonnage tax.

The association, in a memorandum submitted to the Union Finance Minister, pointed out that dredgers are merely ships with special purpose equipment and it is unfair to exclude dredgers from the purview of tonnage tax. The association President, Mr Suresh G. Kewalramani, urged the Minister to consider dredgers at par with ships in the tonnage tax and remove the handicap in its growth by removing the disqualifying clause against dredgers.

As India is very adversely placed in the global business of dredging, he said that the valuable incentive of tonnage tax is absolutely necessary for dredging industry like that of shipping to expand its fleets. There is no reason to deny the incentive of tonnage tax regime to Indian dredgers at a time when Indian dredging companies are, for the first time, actively participating in global dredging contracts in Dubai, Iran, Iraq, Bahrain, Maldives, Bangladesh and even in Korea, he added.

According to Mr Kewalramani, India suffered heavily in the dredging business due to the monopoly of dredging companies from Netherlands and Belgium, which was evident from the work of 19 dredging projects carried out by foreign companies all along the coastline from Gujarat to West Bengal. Last year, nearly 70 per cent of the maintenance dredging works worth Rs1,000 crore in India were carried out by foreign firms, he said.

By virtue of efficient and cost-effective crew in the country and with the support of large fleet, Indian companies would be in a very good position to compete for global as well as in fast increasing projects on Indian coasts. The introduction of tonnage tax for dredgers would definitely increase India's capability to compete with foreign flag vessels, he said.

The objective of the Association, he said is to spread knowledge, information, technology, technical know-how and techniques of dredging business between Indian companies and to find and derive solutions of their problems and difficulties faced in the business. It would also try to establish fair and best practices and equitable principles and also to oppose any legislative measures affecting the dredging industry in the country.