Lok Sabha Question No. 1587 (UNSTARRED), answered on 2023-02-10
Subject: Creation of Maritime Fund
Ministry: PORTS, SHIPPING AND WATERWAYS
Asked by: Rajendra Dhedya  Gavit

## GOVERNMENT  OF INDIA MINISTRY OF PORTS, SHIPPING AND WATERWAYS

## LOK SABHA UNSTARRED QUESTION  NO. 1587

ANSWERED ON 10/0212023

## CREATION OF MARITIME FUND

1587. SHRI RAJENDRA DHEDYA GAVIT.

Will the Minister of PORTS,  SHIPPING  AND WATERWAYS be pleased  to state:

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- (a) whether  the Government  has any proposal  for the creation of Maritime Fund for small and medium lndian entrepreneurs;
- (b) if so, the details  thereof,
- (c) whether  the share of lndian ships in Exim trade has reduced lo 7-7.5 percent  in comparison  to 1980s and the share of lndian flagships in coastal shipping is meagre 10 percent which speak volumes on the health of lndian shipping industry;  and
- (d) if so, the details  thereof along with the steps taken by the Government to improve this situation?

## ANSWER

## MINISTER OF PORTS, SHIPPING AND WATERWAYS (sHRr SARBANANDA  SONOWAL)

- (a)&(b)  Maritime lndia Vision, 2030 envisages  creation of a Maritime Development Fund to provide  easy access to working capital and longterm finance needs of maritime sector.
- (c)& (d) The Government has taken the following maior steps to increase the tonnage under lndian flag :-

## (i) Revision of the criteria for Riqht of First refusal(ROFR):

The criteria for granting  the Right of First Refusal  in chartering of vessels  through  tender process has been revised for promoting tonnage  under lndian flag and ship-building  in lndia, so as to make lndia an Atma-nirbhar/self  reliant Bharat, in terms of tonnage and ship-building  in lndia. The following is the revised  hierarchy  of RoFR with the highest priority to lndia built, lndian flag (lndian owned) vessels;

- (1) lndian  built, lndian  flagged (lndian owned);
- (2) Foreign built, lndian flagged (lndian  owned);
- (3) lndian built, foreign  flagged (foreign  owned).

This will promote  demand  of lndian  built and have the priority  in chartering  and will also business support to ships built in lndia. lndian flag vessels provide  additional as such vessels will market access and

## (ii)  shi

Government  of lndia has approved  the Financial  Assistance  Policy for lndian Shipyards on 9th December 2015, for grant of financial assistance to ,lndian shipyards. only those vessels shall be eligible for grant of financial assistance, for which the construction commences  subsequent to the signing of valid contracts. Vessels which are constructed and delivered within a period of three years from the date of contract  are eligible for availing frnancial  assistance under the policy. For specialized vessels, the delivery  period can be extended  till six years. Financial  assistance shall be  @  20% of the contract prrce, actual receipts, fair price (whichever  is least) to lndian  shipyards.  Under the policy, the financial  assistance  extended  would  be reduced  by 3% every three years.

A scheme for the promotion of fragging of merchant  ships in lndia by providing Rs..1624 crore over a period  of five years  as subsidy  support  to lndian shipping companies  in global  tenders  floated by Ministries/Departments  and Central  public  Sector  Enterprrses (cPSEs)  for import of Government  cargo. The rate of subsidy  rs based  on age of the vessel.

## (iv)

lndian and Foreign  entities intending  to engage foreign flag vessels for coastal  trade of lndia need to have a ricense under section  406 of Merchant Shipping  Act, l  gsg  from DG shipping,  Gol. The DGS issues ricense  to such foreign  frag vesser  onry after ensuring  that no lndian vessel  is avairabre  for such trade/function  to be performed  by foreign frag vessel. Accordingly, lndian ships are given priority  above foreign strips for such transportation. Because  of this facirity, these entities and even shipping companies  make an effort  to own or register  vessels under lndian  flag. This helps in increasing  the lndian shipping  tonnage.