Shipping industry eyes revamped PLI scheme, green initiatives in upcoming Budget 2024
NEW DELHI : The shipping industry is expecting that the upcoming Union Budget 2024 will greenlight the revised production-linked incentive (PLI) scheme for manufacturing shipping-grade containers. Specific reforms expected include increased funding for port modernisation and incentives for green shipping practices.
Centre is expected to revive production-linked incentive (PLI) scheme for manufacture of shipping containers in budget. The Ministry of Ports, Shipping, and Waterways has proposed a revised PLI scheme to boost the manufacturing of shipping-grade containers, after a previous plan for the same was shelved post cabinet discussions, government officials told Moneycontrol.
The revised PLI scheme recommended by the Ministry of Ports, Shipping and Waterways has a reduced budget of Rs 5,000 crore and a shorter tenure of three years. The earlier proposal for Rs 11,000 crore of incentives over 9 years was shelved by the Cabinet Committee on Economic Affairs (CCEA).
What Budget may deliver
Expectations are also that the government may launch a maritime development fund with a corpus of Rs 15,000 to 20,000 crore to support shipbuilding firms with low-interest loans, reported CNBC Awaaz. The fund will provide loans to shipbuilding firm at cheaper rates with simple conditions.
The Budget could also see the announcement of a green ship scheme under which the government plans to promote pollution-free hydrogen-based vessels on domestic waterways, according to the report.
The Centre is reportedly planning to replace oil-guzzling ships plying on the Indian rivers with clean vessels by providing incentives under its green ship scheme.
The ministry has proposed a joint venture between the Shipping Corporation of India (SCI) and Indian Oil Corporation (IOC) for the manufacturing of large oil tankers, aiming to reduce dependence on foreign firms, the CNBC Awaaz report added.
The shipbuilding scheme, as part of which, the companies receive up to 20 percent financing may be extended beyond 2026 in Union Budget 2024.
The Shipbuilding Financial Assistance Policy (SBFAP), launched to promote the “Make in India” initiative and support the shipbuilding industry, may be extended beyond 2026.
This policy, which offers financial aid to Indian shipyards for contracts signed between April 1, 2016, and March 31, 2026, could continue with financial assistance remaining at 20 percent, suggested a Zee Business report.
