INDIAN LINE TO RESUME BOX SERVICE TO EUROPE

INDIAN LINE TO RESUME BOX SERVICE TO EUROPE

State-owned Shipping Corp. of India plans to resume regular, direct container services to Britain and the European Continent early next year.

SCI will initially offer a sailing twice a month from the Jawaharlal Nehru near the Port of Bombay. The ports of call haven't been finalized.The line, India's biggest, used to carry containers but stopped in 1991

because the service was losing money. It entered into slot arrangements with foreign lines and then carried boxes only irregularly.

In December, the company will be getting the first of three new cellular box vessels, each with capacity equivalent to 1,450 20-foot containers, or TEUs. The other two will arrive by February.

South Korea's Hyundai Heavy Industries Co. is building the ships at a cost of $41 million each. When all three are in operation, additional services will be considered, the company said.

Shipping sources in Bombay said Wednesday that the line will face stiff competition from several foreign companies that already offer a regular weekly service and may charge lower rates. SCI reportedly is considering consortium arrangements with other lines.

The carrier is negotiating a loan of $80 million with overseas banks for its expansion program.

"International bankers have offered long-term loans at a fixed rate of 7 percent, reflecting the improved risk perception of India overseas," said P.P. Radhakrishnan, chairman of the company.

The line was offered loans last year at rates between 9 percent and 10 percent, reflecting India's poor credit rating at the time.

After finalizing the $80 million loan, SCI intends to tap the Indian market with a public share issue of 3 billion rupees ($96 million).

SCI announced a net profit of 1.4 billion rupees in the fiscal year through last March 30, compared with 540 million rupees the previous year.

The company plans to buy 79 vessels of various types totaling 2.8 million gross registered tons in the next five years. Last April, SCI had nine on order - three containerships of 1,450 TEUs, two product tankers of 45,000 deadweight tons, three bulk carriers of 70,000 dwt. and one crude tanker.