Kolkata, March 27, 2006 (Business Standard)

Garden Reach Shipbuilders and Engineers (GRSE), a wholly owned subsidiary under the ministry of defence, is in the process of firming up expansion plans for augmenting its capacity by around 40 per cent.

T S Ganeshan, chairman and managing director of GRSE, said, "We are going to acquire 40 acres in the vicinity of the existing unit at Garden Reach and another 40 acres in Haldia. This would augment our capacity by around 40 per cent."

The project in Haldia would mainly focus on repairing activity of merchant vessels.

"Currently, repair of merchant vessel forms a very small part of our operations. With activities of Haldia port increasing significantly, we are planning to focus on the segment, " said Ganeshan on the sidelines of the launch of 'Landing Ship Tank-Large (LST-L)' Airavat.

GRSE has already initiated talks with the Kolkata Port Trust (KoPT) for the land in Kolkata. "We are discussing with KoPT so that a new facility can be set up in the area adjacent to our existing facility. A feasibility study is being conducted for which consultants have been appointed, SBI Capital being one of them," he added.

A clearer picture would emerge once the feasibility study was completed, which would be over the next three months.

The investment for the expansion was not yet finalised, he confirmed.

Meanwhile, the order book position for GRSE was around Rs 3,500 crore, which was to be delivered over the next six years. The Indian Navy has earmarked funds worth Rs 4,700 crore for fleet acquisition, said Suresh Mehta, flag officer commanding-in-chief, eastern naval command.

"We will be placing orders worth Rs 550 crore with GRSE, Rs 1,400 crore with Mazgaon dockyard and Rs 100 crore order with Goa dockyard," he noted.

Airavat had more than 90 per cent indigenisation.

The 124.8 metre long ship can carry 12 main battle tanks, 10 army vehicles and 500 troops for amphibious operations.

Over the past two months, GRSE had already delivered two fast attack crafts and two more would be delivered shortly.

Ganeshan added that GRSE had orders for four anti-submarine corvettes.