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Dredging Corporation of India Ltd (DCI) will soon sign a strategic alliance with the Abu Dhabi government-backed National Marine Dredging Company (NMDC) to pursue work jointly in India and overseas markets using each other’s resources, equipment and knowhow, a top company official has said.
“The board has approved a proposal to sign a memorandum of understanding with NMDC to collaborate with each other on undertaking works,” G Y V Victor, Managing Director and Chief Executive Officer told BusinessLine. The Ministry of ports, shipping and waterways has also backed the plan, he said.
The collaboration will cover India, Bangladesh, GCC countries, Africa and other parts of the world.
The alliance will focus on three major areas- dredging, project development on build, operate and transfer (BOT) or public, private partnership (PPP) model as well as port development, management and operations, Victor said.
The duo will execute works either through a joint venture or in a consortium on a project-to-project, case-to-case basis, he added.
India’s biggest dredging contractor is owned by four Union government-owned major ports.
Cutter suction dredgers
NMDC is strong on cutter suction dredgers (CSD) that are used to deepen the channel of ports and harbours while DCI has a large fleet of trailing suction hopper dredgers (TSHD) that are deployed to maintain the channel.
NMDC’s fleet of 19 dredgers includes seven heavy duty cutter suction dredgers. DCI has 10 TSHD’s in its fleet of 17 dredgers.
DCI will use NMDC’s cutter suction dredgers while the Abu Dhabi company will charter DCI’s trailing suction hopper dredgers to undertake work in India and abroad on a project-to-project basis.
The alliance is expected to create a strong partnership to help compete with Dutch and Belgium dredging contractor who dominate the industry.
“Through the strategic pact, DCI will have a strong Asian partner on par with European dredging contractors who is willing to participate in dredging works proposed to be carried out in India and overseas,” a government official said.
NMDC has been consolidating its presence in the United Arab Emirates (UAE), besides opening offices in many counties including India as part of a strategy to venture into global markets to reduce geographical risk.
NMDC has been scouting for opportunities to acquire entities in backward or forward stages of the value chain as well as to enter into strategic alliances or acquisitions to diversify the business into civil or infrastructural development, the company said in its annual report for 2020.
The acquisition of National Petroleum Construction Company PJSC was a major step forward in this direction.
“The Group continues to look out for further acquisitions and alliance in this area to support future growth,” NMDC said in the annual report.
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