The Government of India signed a loan deal worth $76 million with Japan International Cooperation Agency (JICA) today, for a project to upgrade the environment management plan at Alang-Sosiya ship recycling yards. The total cost of the project will be $ 111 million, out of which $76 million will be provided as a soft loan from JICA. Out of the remaining amount, $25 million as taxes and fees will be borne by Government of Gujarat and the balance $10 million will be shared by Ministry of Shipping & Government of Gujarat. The project will be executed by Gujarat Maritime Board (GMB) and is likely to be completed by 2022.
This project will help the Alang-Sosia ship-recycling yards to comply with international safety & environmental regulations. This will attract more business at the recycling facilities at Alang, thereby further consolidating India’s share in the global ship-recycling industry. Nitin Gadkari, Minister of Shipping, recently said that India is ready to ratify IMO’s Hong Kong convention. Currently, just six countries have acceded, which are Norway, France, Denmark, Belgium, Panama and Congo.
India is a major ship breaking and recycling player with famous Alang ship breakyard in the state of Gujarat. More than half of the world’s ship makes its last voyage to Alang. International NGO ESCA has been criticising the yard for its alleged failure in spreading pollution and risks to workers. Under the Hong Kong convention, ships are not allowed to be dismantled on the beach sand.
As per details accessed from JICA’s website, a loan of 8520 JPY will be charged at 1.2% with a moratorium period of 10 years and repayment after 30 years. This project will also help in safeguarding the marine and coastal environment. The use of advanced decontamination technology will rule out the possibility of fire accidents in oil and chemical tankers, thereby ensuring workers safety. The project is expected to result in an increase in direct employment from 50,000 to 92,000 people and indirect employment from 1.5 lakhs to 3 lakh people.