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INSA seeks clarification on impact of IRS statutory survey monopoly

INSA seeks clarification on impact of IRS statutory survey monopoly

Mumbai: The Indian government's decision, this week, to end authorisation of International classification societies to conduct statutory surveys of Indian flagged vessels has led the Indian National Shipowners Association (INSA) to seek clarification of the new regulations. The decision that comes into force in three months and will endow the Indian Register of Shipping (IRS) with the exclusive rights to conduct such surveys, was conveyed to societies such as Lloyds Register, Det Norkse Veritas, Bureau Veritas, Germanischer Lloyd, ABS and ClassNK via an official letter sent by the Deputy Director of Shipping.

Munbai-newspaper The Indian Express has reported the letter as saying, 'The administration is grateful to you for assisting us in carrying out the survey all these years. Now, the Government is satisfied that the Indian Register of Shipping is in a position to undertake the entire survey requirements of the Government of India.'

However, the Indian shipping community is quick to point out that granting IRS exclusive statutory survey rights has minimal immediate impact. 'The situation itself is not unworkable,' INSA chairman and Shipping Corporation of India md Sabyasachi Hajara (pictured) told SeatradeAsia-Online. 'It is up to the flag state to chose who would be conducting the statutory survey, so they have chosen to exercise this right.'

He adds, 'There is a great deal of overlap between the statutory surveys and class surveys. The IRS doesn't have a big network and set up like these big international classification societies, so often it is the same people doing both the surveys.'

'As long as there is dual class on Indian vessels, the situation is not really changing all that much,' he states, nay saying rumours that IRS may gain exclusive rights to class Indian Flagged vessels. 'There is no indication that this is the case at all.'

However, he says that there are logistical hurdles for this decision that must be tackled by the Director General of Shipping for India. 'We will be writing to the DG to get clarification for practical problems such as in the case of damage surveys.

'Since IRS surveyors are Indian nationals and need visas for most countries around the world, this hampers international travel at short notice,' he elaborates. 'We will have a much clearer idea of the implications of this decision once we have official clarification,' he adds.

For the international classification societies themselves, the situation came as a bit of a shock. 'I can confirm that we have received a letter letting us know of this decision,' said Dr Hermann Klein, member of the GL Executive Board. In an exclusive interview at the sidelines of the German Classification society's annual press dinner, he said, 'We have never had a situation like this before, historically we have seen an increase in the number of flag states, so we were not expecting it.'

However, Klein has pointed out that the blow has been balanced by GL's recent successes in other overseas markets. 'Last year we signed contracts with the flag states in America and Russia, so we are still in a strong position,' he said.  [08/05/08]