Logistics

Cochin Shipyard, Dredging Corp to sign first ‘Make in India’ dredger building deal for $100-105 million

P. Manoj | Updated on: Mar 15, 2022
A trailing suction hopping dredger at the Mahanadi river in Odisha

A trailing suction hopping dredger at the Mahanadi river in Odisha

Cochin Shipyard to receive subsidy from the government per ‘Shipbuilding Financial Assistance Policy’ from 2016  

State-run Cochin Shipyard will build a high-capacity dredger with Dutch technology support for Dredging Corporation of India Ltd (DCI) for $100-105 million (about ₹803 crore) in a boost to the government’s ‘Make in India’ plans.

The shipbuilding agreement for a trailing suction hopper dredger (TSHDs) having a hopper capacity of 12,000 cubic metres will be signed on Thursday between Cochin Shipyard and Dredging Corporation, officials said. TSHDs are used to maintain the channel of ports.

Mumbai-listed Cochin Shipyard will receive an extra 17 per cent on the contract price of the dredger as subsidy from the government per a ‘Shipbuilding Financial Assistance Policy’ approved by the Cabinet in 2016 for a ten-year period. Dredgers were included in the list of specialised vessels qualifying for the subsidy through an amendment to the policy in December last year.  

The dredger building agreement is being formalised more than a year after Cochin Shipyard and Visakhapatnam-based Dredging Corporation — owned by four government-owned major port authorities — signed an MoU in February 2021 to construct the dredger.

The dredger — christened ‘DCI Dredge Brahmaputra’ — will be constructed with technology and design support from IHC Holland BV, the world’s largest dredger builder.

This will be the first dredger to be built by Cochin Shipyard at its yard in Cochin following a memorandum of understanding (MoU) signed with IHC in November 2020 for collaboration on technology and design for high capacity, complex dredgers.

Capacity expansion

Mumbai-listed DCI’s fleet of 10 trailing suction hopper dredgers deliver 70-75 per cent of the annual dredging for major Indian ports. As a step towards meeting the increasing demand for dredgers across the country, India’s biggest dredging contractor plans to expand its fleet with a new 12,000 cubic metre hopper capacity dredger.

This will be the first ‘Beagle 12’ TSHD of 12,000 cubic metre capacity designed by IHC to be built anywhere in the world. The new generation TSHD’s of IHC under the ‘Beagle’ series are highly popular and known to be efficient and highly reliable dredgers.

Dredgers are specialised and complex vessels with highly integrated technical components as well as demanding design and performance criteria. As such, dredger construction is a segment with an inherently high entry barrier, which can be considered advantageous to Cochin Shipyard which has the necessary infrastructure, especially concerning the construction of the larger Cutter Suction Dredgers (CSD) and Trailing Suction Hopper Dredgers (TSHD), officials said.

With a specific focus on ‘Atmanirbhar Bharat’ and ‘Make in India’ initiatives of the government, local manufacturing is becoming a mandate.

High entry barrier

The ‘operational and technological knowhow’ in dredger construction, particularly the large size and high-end Trailing Suction Hopper Dredgers, are “closely held” in Europe, primarily by Dutch firms, making IHC a global giant in the field. Big global dredging contractors such as Van Oord, Boskalis and Jan De Nul are also based out of the Netherlands.

Dredger construction has been identified by Cochin Shipyard as a priority area for revenue growth in its ‘Strategy Roadmap for 2030’.

Collaborative operating models are essential not only from a growth perspective, but also from the point of building technical competence within the country, said a government official.

Published on March 15, 2022
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