Times of India – Govt unaware of owners of ships coming to Alang, says report

2 June 2011 - NEW DELHI: The government is unaware of who really owns the ships that are coming to Alang for ship-breaking, an internal report of the government accessed by TOI admits.

The report prepared by the Standing Monitoring Committee on Shipbreaking Yards at Alang notes that the customs officials and the Gujarat Maritime Board are unable to verify whether the documents provided to them when the ship beaches at Alang are falsified or not.

The committee has recommended that the Director-General Shipping be made responsible for verifying the documents of the ‘end-of-life’ ships coming to Alang for being broken down.

But the Gujarat Maritime Board has attempted to create a loophole in this. It has said that if the DG Shipping does not clear the documents within 48 hours then it would be presumed that the certificates submitted are authentic and genuine.

The committee had noted that the customs and GMB officials had been unable to “verify the authenticity and genuineness of ship’s registry/flag in the past in respect of some ships referred to them”.

The issue of ownership had become important with a Naval intelligence report. The report had warned in 2004 that the Dawood gang had invested heavily in the business of ship-breaking. “A large number of cash buyers (who buy these condemned ships against cash) are Pak nationals based at London/UAE. Due to large profit margins, Dawood group appears to have invested heavily in Cash Buyers thus having a stake in most deals,” Directorate of Naval Intelligence had noted.

Almost 40-50% of the metal trade arising from breaking down a ships was done through the hawala route, it had also recorded.

The intelligence report had warned that smuggling of contraband, explosives and agents on these ships on to Indian soil was a distinct possibility. It had said that the defence ministry should give clearance for all such vessels before the ship is allowed to enter Indian waters.

It has been reported several times that ships bearing registration with shell companies in countries like Liberia, Comoros Islands, Kiribati and Panama come for breakage at Alang. The real owners of the ships remain hidden behind these shell companies with the ships carrying what are called ‘flags of convenience’.