Islamic financing facilities for Shipping Corp of India

THE Shipping Corp of India (SCI) has become the first Indian company to secure Islamic financing facilities.

The firm has signed a US$50 million medium-term loan facility with the Al Rajhi Banking and Investment Corp of Saudi Arabia to finance the building of two new container vessels.

SCI finance director declined to say how much money the company would save since Islamic banks do not charge interest.

Built by South Korea's Hyundai Heavy Industries at a cost of US$82 million, the 1,500 TEU (20-foot equivalent unit) ships were delivered last month.

The transaction was arranged in close association with Chase Manhattan Bank.

Additional funds were provided by the Korea Export-Import Bank.