NEW DELHI, Dec. 13/11 – India Reliance Industries has significantly stepped up gasoline sales to North and South Americas and routed shipments via giant fuel tanks at Bahamas, contributing to the sudden and dramatic rise in India’s exports to the Caribbean nation that has baffled government authorities.

The value of Reliance’s fuel shipments to Bahamas would rise 50% to $3.2 billion in 2011-12 if it keeps exporting fuel at the current rate – $1.9 billion in the first seven months of the fiscal year.

Surging exports to Bahamas have raised eyebrows as the value of shipments to the country, which is smaller than the Jamnagar district where Reliance’s refinery is located, jumped to $2.2 billion in 2010-11 from negligible levels two years ago.

The data matches Reliance’s shipment to its Bahamas tanks, which also rose to $2.2 billion in 2010-11 from zero in 2008-09. The final destination was not the Bahamas and almost the entire quantity was shipped onwards to the big markets in the region, sources close to the company said.

RIL starting using the tanks at Bahamas in 2009-10, when it shipped gasoline worth $631 million, these sources said. Since only a small fraction of this shipment is used locally in the Caribbean region and often the fuel is directly loaded to smaller ships at Bahamas for shipment to the North and South American markets, the export numbers may not match the import data of Bahamas, industry officials say.

The company receives payments for the exports from customers in the US or South America. The company has hired fuel tanks in Bahamas, attracted by the prospect of huge savings in shipping costs by using large tankers to ship fuel to the strategically located country.

The strategy allows the company to avoid using the relatively costly smaller vessels except for last-mile delivery to the final destination, the sources said.

This is an excerpt from The Economic Times as it appeared on December 13, 2011. For updates or to read the current version of this post in its entirety, please click here.

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