A parliamentary committee on Tuesday asked the government to grant additional financial powers to the Shipping Corporation of India for its investment decisions such as fleet acquisition.

SCI, the Mini Ratna that is set to be privatised, can incur capital expenditure upto Rs 300 crore (Rs 3 billion) on new projects such as purchase of vessels, without the government approval.

"Considering the huge capital outlay required for building/acquisition of new ships, the financial powers granted to SCI under the Mini Ratna dispensation are inadequate," the parliamentary committee on public undertakings said in its latest report, tabled in Parliament on Tuesday.

The committee feels that the enhancement in the financial ceilings for investments is necessary at a time when SCI is focussing on energy transportation, requiring substantial investments for the acquisition of bigger tankers and LNG vessels.

"The government should consider granting additional financial powers beyond the limit stipulated under the Mini Ratna dispensation to the SCI," the report said.

It also recommended setting up a separate development-funding agency for funding the acquisition of new ships.

The committee wanted customs duty on import/purchase of tugs, pusher crafts, dredgers, floating docks and cranes to be completely removed "as this will help the shipping industry to achieve economic viability."