Rs 25000-Crore Maritime Development Fund Set To Sail By Year-End, Aiming to Boost Indigenous Shipbuilding

India’s proposed Maritime Development Fund is likely to be ready by the end of this year, writes businessline.

The fund will be used to provide long-term, low-cost financial assistance to bolster indigenous shipbuilding efforts in the country.

Moreover, the fund would also foster cruise tourism and support activities such as the mechanisation and capacity expansion of existing ports through public-private partnership initiatives.

According to ongoing discussions, two potential options have emerged for establishing the fund: either creating a dedicated maritime vertical under a proposed development finance institution (DFI), or establishing a standalone company with multi-agency equity.

“We want to ensure that we have a ship-building industry, that is local. So we want to do the entire value chain here – that include ship-building, flagging, ownership financing, leasing, among others. If not the entire, we want to have upto 5 per cent of world’s tonnage soon. That is what the Maritime Development Fund will work towards,” reports businessline, quoting TK Ramachandran, Secretary, Ministry of Ports, Shipping and Waterways (MoPSW).

The fund is proposed to begin with an initial corpus of Rs 25,000 crore, distributed over a seven-year period. Its mandate would encompass various funding mechanisms, including debt, equity, Viability Gap Funding (VGF), and buyer credit support.