Long-Term Financing Needs for Ports and Shipping Assets
Industry representatives highlight the necessity for evolving domestic avenues for long-term financing to foster growth in ports and shipping sectors in India.
Current Challenges
- Bankers show reluctance in lending for ship purchases, posing a challenge for ship owners.
- Port infrastructure developers call for 30-50 year debt instruments to meet financing needs.
- Existing infrastructure bonds typically mature in 15 years, deemed insufficient for long-term projects.
- Bank loans often come with high interest rates, offering limited viable options for financing.
Government Initiatives
- The Maritime India Vision 2030 plans for ₹3–3.5 lakh crore in investments across ports, shipping, and inland waterways.
- The Centre launched a ₹25,000-crore Maritime Development Fund (MDF) to address industry concerns.
- Incentives are provided for shipbuilding and shipyard development.
- The National Bank for Financing Infrastructure and Development (NaBFID), established in April 2021, aims to support long-term infrastructure financing.
- Sagarmala Finance Corporation (SMFC) and Hudco signed an agreement to finance ₹80,000 crore over the next decade under the Sagarmala programme.
Additional Measures
- The government has allowed the use of large ships as collateral for loans, enhancing capital availability for maritime transport.
- Despite these efforts, bankers remain cautious about financing vessel purchases.
The initiatives are part of a broader strategy to boost India's maritime competitiveness, reduce logistics costs, and enhance port-led development.
