Bangladesh Cancels $21-Million Order From Garden Reach Shipbuilders

The Bangladesh government has cancelled an order worth nearly Rs 180 crore from Garden Reach Shipbuilders & Engineers Ltd. The contract was for construction of an advanced ocean-going tug, according to an exchange filing on Wednesday.

The order, worth $21 million, was from the Directorate General Defence Purchase, Ministry of Defence, Bangladesh. The construction and delivery of one advanced ocean-going tug was to be designed, built and delivered in 24 months, according to the previous notification.

The overall length of the tug would have been nearly 61 metres and the vessel was set to be about 15.8 metres wide with a depth nearly 6.8 metres. The ship's maximum speed with a full load was to be at least 13 knots.

The company had clocked an order book of Rs 22,680 crore as on March 31, Garden Reach Shipbuilders' Chairman and Managing Director PR Hari said in an analysts call.

Kolkata-based Garden Reach Shipbuilders is a public sector company that builds and repairs commercial and naval vessels. It primary client includes the Indian Navy and Indian Coast Guard.

Ties between India and Bangladesh have been strained since the ouster of former Prime Minister Sheikh Hasina in August last year. The interim government under Muhammad Yunus has also moved closer to China, securing $2.1 billion in new deals.

Last week, India implemented curbs on imports from Bangladesh on goods worth $770 million (Rs 6,600 crore), covering nearly 42% of bilateral imports. The move was seen in response to Dhaka's recent restrictions on Indian yarn, rice, and other goods, as well as the imposition of a transit fee on Indian cargo, which has marked a departure from past cooperation.

Shares of GRSE closed 4.43% higher at Rs 2,500.5 apiece on the NSE. The shares have risen 54.7% on a year-to-date basis and 109.6% in the last 12 months.