Lok Sabha Question No. 541 (STARRED), answered on 2018-04-05
Subject: Shipbuilding Financial Assistance Policy
Ministry: SHIPPING
Asked by: BALKA SUMAN

## GOVERNMENT OF INDIA MINISTRY OF SHIPPING

## LOKSABHA STARRED  QUESTION No.  *541 TO BE ANSWERED  ON 5th APRIL,2018

## SIIIPBUILDING  FINANCIAL  ASSISTANCE  POLICY

- *541:  SHRISTA4ANBALKA

Will the Minister of SHIppING be pleased  to state:

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- (b)  if so, the details  and the present  status  thereof;
- (a) whether the Government \_has implemented  the Shipbuilding  Financial Assistance  policy for Indian Shipyards  with a view to promoting  .Make in India, programme  and encouraging  domestic  shipbuilding ;
- (c)  whether the Govemment  has introduced  the revamped software  and updated the :#etlnes to facilitate  smooth process  for ava,ing financiar assistance  urrd"rih"  poli"y;
- (d)  ifso, the details  thereofl

## ANSWER

## MINISTER  OF SHIPPING (SHRINITIN  GADKARI  )

- (a) to (d): Yes, Madam.  A Statement  is laid on the Table  of the House.

STATEMENT REFERRED TO IN REPLY TO PARTS (a) STARRED  QUESTION  NO.  *541  TO BE ANSWERED ON SHRI SUMAN BALKA REGARDING  'SHIPBUILDING POLICY' to (d) OF THE LOK SABHA sth APRIL 2OI8 RAISED  BY FINANCIAL ASSISTANCE

## (a)  &  (b):

- i. To promote  Government  of India's 'Make in India' initiative  and to encourage domestic shipbuilding  by providing  a level playing  field vis-a-vis foreign shipyards, the Govemment  had approved the Shipbuilding  Financial Assistance Policy for Indian Shipyards in December 2015.
- ii. An initial budgetary  requirement  ofRs. 4,000 Crores for a period  of 10 years from 2016-17  to 2025-26 (plus  3  /ears  or more, as the case may be, for spill over "ur.r1 *r. projected for the policy.
- iii. Under the policy,  financial assistance  @20%  of the "Contract Price"  or the  .,Fair  price,, as determined  by intemational  valuers,  whichever is lower, is to be ganted  for any vessel  built in India,  subsequent  to its delivery.  Provided  that, at the time of relJase  of financial  assistance, if the actual payment received for a vessel is lowo than the contract pri"" or iui. price, such payment  shall replace  the contract price  or fair price  in the formulae  for computation  of the financial assistance-  The quantum  of financial ^.istrnc" shall reduce by 3% aier every  three years  ofthe policy.
4. iv' Ministry of Shipping  issued  the guidelines on 16s Jure, 2016 and the same were uploaded  on the website of the Ministry  of Shipping  and are now available  in the archive section  of the website  of the Ministry. Revised glldelines  were issued  in January 2017. AmenJed guidelines were issued  by this Ministry on 3lst October 2017.
- v. Etigibility conditions:  Erigib ity conditions are explained  in detail Guidelines  dated 3r't october,  2017, which  are uploadid  on the website Shipping. The salient points  in this respect are; in the Ministry's of the Ministry of
6. Shipbuilding  c(lrtract to be signed during the period 01.04.20  r6 to 31.03.2026  [paragraph 1 (b) (page 1/3'5)1. 1.
7. Delivery ofvessels should  be done within the period of03 years  from the date of contract or up to six years  in the case of specialized  vessels. 2.
8. Assembly  of hull installation/commissioning  of the major machinery/equipment,  tesvtrials to be carried  out in India. 4.
9. Major portion  ofthe hull is to be constructed and assembled  in India. 3.
10. shipyard  sh.ould not have  availed any monetary  support  under any other central/State Gofi. Scherne. 5.
11. Applicatio':  for In-principle  approval and Financiar  Assistance are to be made by the Shipyard  in accordance  with Ministry's  Guidelines. 6.
12. vessel shall  be classed  with any Recognized  orgarization  of the Gort. of India. 7.
13. All catel,ories  of floating structures registered under  the prevairing statutes  except the following  vessels,  are eligible  for financial  assistance  for striiUuitaingi 8.
- a) vessels  built for Indian buyer  or ship owner, which do not exceed length  of more than 24 meters.
- c) \'essels built for defence  purposes  or for use by Navy  or Coast  Guard.
- b) \'essels made ofwood, irrespective  oftheir lengths.
- d) \/essels  built under  contracts  secured on nomination  basis from the central  or State (iovemment  or their agencies, except those  secured from the cenfiar or State  public f;ector  Enterprises.
18. Present  sta"us  rcgarding the implementation  of the poiicy is as follows: vl.
- b) Number ofapplications for which in-principle  approval granted  tilr date:22
- a) Numbr:r  ofapplications  for in-principle  approvals  received  so far :27
- c) Number of applications for release offinancial asiistance received  so far: 05
- d) Number of applications for which  financiar assistance is already approved  till date: NIL

- i'TheShipyardsAssociationoflndiahadraisedcertainissueswithregardtothe orevious  web application  (whioh had been  launched  in June 2016) and the revised Erio"iiilr  i**,li i" r**.y  2017 for processing applications  for financial assistance iurder the  policy. The rvri"iroy of Shipping held a series of consultations  with  the stakeholders  ana oirecioraie  den",al  oi'sr'iplog  and an updated  version of the web appfra"if"",  along with an'arnena"a  .et of g"iaiir.r  was launched on 31" October 2017 to facilitate i*pi.."nt"tion  of the  folicy'  fhe ugdatl{  versio.n  o-f tn1^yf' application is being administered and monitored  by the Directorate  beneral  oI ghiBping,  Mumbei'
- ii. Under the 4mended  guidelines,  increased numbers of days are now avail able with  the Jiny*d,  to uppfy ,riO.,  tt .  pifi.V, * well as to,obtain  and submit valu ation reports. Td'6&qd ,i,iu'uppri""ti*lir" il."*t.. a wider choice of intematio:ral  valuers  bv whom the valuation "f;;;J;;;; carriea out. The list of Internatior  al valuers  has been expanded  fro, S".--t" fift;;.  F". the benefit of users and sta'reholders,  the detailed amendta god;iini ;;;;;; uploaded  on the websile  of Ministrv  of SltiPPing,
- iii Shipyards  can submit applications  Td "ll supportins  documen ts for financial assisance  urlder the policy  throug-h.the  web-portal'  Tie  web  po nal  provides  for processing ol the appiicatilns,  inciuding  queries' replies'  clarifica  tions' etc' for inp.insiple  ippru"al  as well as financial  assistance'