Crane collapse at HSL, a setback to ‘Make in India’ plans

The collapse of a newly-built crane on Saturday during load testing ahead of commissioning, leaving ten workers dead at State-run Hindustan Shipyard Ltd in Visakhapatnam is a setback to India’s efforts to ‘go vocal for local’ as part of the ‘Atmanirbhar Bharat’ strategy.

Defence shipbuilder Hindustan Shipyard, according to government sources, will blacklist Gujarat-based Anupam Industries Ltd which supplied the ₹17-crore crane in August 2017.

Per government guidelines, any public sector which blacklists a company, all other PSUs are duty-bound to follow suit.

Anupam Industries, India’s largest overhead crane maker, has manufacturing facilities in and around Anand and also in Mundra, Gujarat.

During the commissioning of the crane three years ago, certain technical deficiencies were observed by HSL and the shipbuilder requested the vendor to rectify the defects and undertake load trials which was part of the scope of work.

“However, ever since we indicated the technical deficiencies and pointed out the problems, despite repeated requests and reminders, Anupam Industries did not attend to the work and all technical deficiencies observed during commissioning remained unattended,” an HSL official said.

Since the load trials of the crane had not been completed by Anupam, HSL did not use the cranes or could not use the cranes even after paying ₹17 crore.

“So, we sent them a performance notice as per the clauses of the contract and we told them if you don’t complete the commissioning and the load trials, then we will outsource the work to another contractor at the risk and cost of Anupam,” the official said.

Despite serving the performance notice, Anupam failed to attend and complete the balance commissioning work like rectifying the technical faults and refused to do the load trials, the official said.

“Anupam Industries has not responded to our letters, leaving us with no choice but to outsource the balance commissioning work and load testing to Greenfield Corporation, a local vendor, and consequently this incident happening. The fact that Anupam didn’t come for three years indicates that they knew something was wrong and they couldn’t do the load testing, otherwise why did they shy away from doing load testing,” the official asked.

Separately, Anupam Industries is locked in an arbitration case involving supply of three rail mounted quay cranes (RMQCs) to State-owned Jawaharlal Nehru Port Trust (JNPT) a few years ago. JNPT levied liquidated damages from the crane maker for delay in delivering the cranes.

The cranes are currently operational. Apart from the liquidated damages, JNPT deducted extra money from the supplier which triggered arbitration proceedings, a shipping ministry official said. JNPT has now been advised by the government to settle the matter through conciliation.

The mishap comes days after the shipping minister Mansukh Mandaviya said that the government will push domestic companies to manufacture cranes used for cargo handling at ports to replace annual imports worth ₹1,000 crore of such equipment.

“We will aggressively work towards ‘Atmanirbhar Bharat’ by promoting port-led industries and industrialisation. We will boost ship repair and recycling facilities. And among many such initiatives, we have decided to procure ‘Made in India’ cranes for cargo handling at ports,” Mandaviya said on July 3.

He also said that Indian companies can build cranes under 'Make in India' either independently or through the joint venture route.

In 2011, Anupam formed a joint venture company with Japanese conglomerate Mitsubishi Heavy Industries Ltd to manufacture port cranes and material handling equipment.

About 99 per cent of the cranes operating at Indian ports were manufactured in China.

On July 23, the government imposed restrictions on Chinese goods and services during public procurement.