Latest news with #MaritimeDevelopmentFund
Economic Times
a day ago
- Business
- Economic Times
India's largest port in the making to raise Rs 30,000 crore debt
AP This is a representative image. The firm building what will become the largest port in India plans to raise as much as 300 billion rupees ($3.5 billion) of debt, giving lenders an opportunity to invest in one of the cornerstones of Prime Minister Narendra Modi's infrastructure overhaul. Owners of the Vadhvan Port Project Ltd., located a few hours north of Mumbai, are looking to raise debt with tenors in the range of 15 to 20 years. They're considering onshore and offshore markets to raise the funds, according to a top official. 'We have started the process of raising debt which will happen in two phases,' said Unmesh Sharad Wagh, chairman at Jawaharlal Nehru Port Authority, or JNPA, which holds a 74% stake. The Maharashtra Maritime Board owns the remaining 26%. The $9 billion port project is a major undertaking for Prime Minister Narendra Modi, who laid the port's foundation stone last year. Upon completion, which is expected toward the end of the decade, Vadhvan will have the capacity to handle some 23 million container units, making it one of the 10 largest ports in the world, according to its backers. IDBI Capital was appointed as advisor to help lineup long term lenders for the first round of funding, with a target of at least 220 billion rupees, Wagh said. The funds will be disbursed over the next five years, and the request for proposals from lenders will be floated during the October to December quarter. JNPA and MMB will jointly infuse about 130 billion rupees worth of equity into the project, said Wagh, who is also chairman and managing director of Vadhvan Port Project. The firm is in talks with multilateral agencies, and is working on reclaiming 1,200 hectares of land, he added. Bolstering the country's maritime infrastructure is a priority for Modi's administration. Through the country's annual budget in February, the government proposed a Maritime Development Fund to support the sector through financial assistance via equity or debt securities. Some of the largest container ships have been forced to skip India because none of its existing ports are deep enough to receive them. Vadhvan's natural depth of 20 meters would allow some of the largest ships to dock. It would also serve as a starting point for the so-called India-Middle East-Europe Corridor, a planned economic link aimed at developing new trade routes between the regions.
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Business Standard
2 days ago
- Business
- Business Standard
India's largest port builder to raise ₹30,000 cr for Vadhvan project
The firm building what will become the largest port in India plans to raise as much as ₹30,000 crore ($3.5 billion) of debt, giving lenders an opportunity to invest in one of the cornerstones of Prime Minister Narendra Modi's infrastructure overhaul. Owners of the Vadhvan Port Project Ltd., located a few hours north of Mumbai, are looking to raise debt with tenors in the range of 15 to 20 years. They're considering onshore and offshore markets to raise the funds, according to a top official. 'We have started the process of raising debt which will happen in two phases,' said Unmesh Sharad Wagh, chairman at Jawaharlal Nehru Port Authority, or JNPA, which holds a 74 per cent stake. The Maharashtra Maritime Board owns the remaining 26 per cent. The $9 billion port project is a major undertaking for Prime Minister Narendra Modi, who laid the port's foundation stone last year. Upon completion, which is expected toward the end of the decade, Vadhvan will have the capacity to handle some 23 million container units, making it one of the 10 largest ports in the world, according to its backers. IDBI Capital was appointed as advisor to help lineup long term lenders for the first round of funding, with a target of at least ₹22,000 crore, Wagh said. The funds will be disbursed over the next five years, and the request for proposals from lenders will be floated during the October to December quarter. JNPA and MMB will jointly infuse about ₹13,000 crore worth of equity into the project, said Wagh, who is also chairman and managing director of Vadhvan Port Project. The firm is in talks with multilateral agencies, and is working on reclaiming 1,200 hectares of land, he added. Bolstering the country's maritime infrastructure is a priority for Modi's administration. Through the country's annual budget in February, the government proposed a Maritime Development Fund to support the sector through financial assistance via equity or debt securities. Some of the largest container ships have been forced to skip India because none of its existing ports are deep enough to receive them. Vadhvan's natural depth of 20 meters would allow some of the largest ships to dock. It would also serve as a starting point for the so-called India-Middle East-Europe Corridor, a planned economic link aimed at developing new trade routes between the regions.
Time of India
08-06-2025
- Business
- Time of India
Tamil Nadu sees Blue Economy as a powerful tool to bring sustainable prosperity to coastal districts
Of late, there has been a growing buzz around the blue economy in Tamil Nadu power corridors. The phrase implies economic activities associated with the ocean, seas and coastal regions, which includes shipbuilding, processing and exporting of seafood, and coastal tourism. Tamil Nadu boasts of having the second longest coastline in India (after Gujarat). But the resource hasn't been tapped to a satisfactory extent. And that is something the TN govt is out to fix. "As TN charts its course towards our CM's (M K Stalin) ambition of a $1 trillion economy, the Blue Economy presents some of the most exciting opportunities. Despite having the second longest coastline in India, we believe our coast is still underutilized from an economic standpoint. This is something we are now addressing with urgency through a vision laid out by our CM," said T R B Rajaa, TN Minister for Industries. "We see the Blue Economy as a powerful tool to bring sustainable prosperity to our coastal districts, through investments that create large job opportunities for both skilled and semi-skilled talents," he added. The state's approach is strategic and focused on three key areas – shipbuilding, seafood processing and coastal tourism. Each of these has the potential to dramatically transform livelihoods and local economies. "The key strategy is maximizing the potential of TN's long coastline. Besides the focus areas, we could tap the state's port facilities spread across its coast. Shipbuilding is an area that has drawn the attention of the Centre as well. The Centre has ambitious plans to be part of the top five shipbuilding nations by 2047. In February, during the Union Budget 2025, a key maritime sector announcement was regarding the establishment of the ₹25,000 crore Maritime Development Fund (MDF) to support long-term investments in the sector. The other big ticket takeaway was the introduction of the revamped Shipbuilding Financial Assistance Policy (SBFAP 2.0) to encourage more participation in shipbuilding activities. With an improved outlay of ₹18,090 crore, this policy is aimed at strengthening domestic shipyards and enhancing their global competitiveness. Tamil Nadu is also working on a Marine Transport policy which could be out in a month, and this could generate a lot of economic opportunities," said Darez Ahamed, MD & CEO, Guidance Tamil Nadu. To understand the potential offered by shipbuilding - consider that just one anchor investor can unlock an entire value chain of MSMEs in welding, precision engineering, logistics and marine services. The state has already initiated talks with global players to set up shipbuilding facilities in TN. As per sources, the order books of these international operators are packed till 2032. On its part, the state must provide the infrastructure needed to help them to establish their units here. For every job created inside the shopfloor of a shipbuilding company, seven jobs will be created outside. That's the potential it offers, say stakeholders. In the seafood sector, TN is no longer content with being just a supplier of raw catch. The game plan now is to build end-to-end infrastructure for seafood processing, cold chains and export-quality packaging, ensuring that value addition happens right here in the state's fishing hamlets, creating better incomes and sustainable livelihoods for the coastal communities. Infrastructure, especially roads connecting the coastal belt, cold chains along the TN coast, availability of power for these cold chains, mapping the wasteland on the coast, utilizing it adequately for growth of marine food and processing industries, are some of the key areas TN should focus on, said a leading consultant for the marine food industry, on condition of anonymity. "We will be addressing all the issues that have been holding back the growth of the seafood industry in Tamil Nadu, vis-a-vis neighbouring states including Andhra Pradesh, which accounts for Rs 26,000 crore worth seafood exports as against TN's Rs 8,000 crore. We would soon match the best performing states in this sector," a TN govt official said. Coastal tourism is a major plus point. Tamil Nadu's coast is beautiful, diverse and rich in culture, but it remains largely unexplored. The state is developing a blueprint to unlock this through sustainable, community-led tourism, which will entail eco-friendly resorts, avenues for water-based recreational activities and support for local entrepreneurship. The aim is to make the coast a world-class destination; while keeping it rooted in tradition. "To ensure this transformation is inclusive, we plan to skill the youth in coastal regions through initiatives under the Naan Mudhalvan programme. We want our coastal communities to be more than beneficiaries. They must be the driving force behind this change. Tamil Nadu's Blue Economy strategy is also about building a just, green and resilient future for our coastal communities, and we are committed to making it a reality," Rajaa said. So, of the three segments that have got the special focus under the Blue Economy strategy, which one might get a head start? "We would like all three to take off big-time, since the opportunities are significant. But realistically, the first shipbuilding could take off in just about a year from now," says Guidance Tamil Nadu's Ahamed. That's just on the horizon.
Mint
05-06-2025
- Business
- Mint
State-run GRSE inks ship building deals with German firm
New Delhi: State-run defence manufacturer Garden Reach Shipbuilders and Engineers Ltd (GRSE) has tied up with Germany's Carsten Rehder Schiffsmakler und Rehder GmbH & Co. KG, for building four vessels, the ports, shipping and waterways ministry said on Thursday. The deal for building four 7,500-deadweight tonnage (DWT) vessels was signed in Oslo on 4 June in the presence of Union ports, shipping and waterways minister Sarbananda Sonowal, the statement said. These vessels will have hybrid propulsion and will be adhering to the latest cyber security norms. This is in addition to an existing order for eight such vessels currently being built at GRSE's Kolkata yard. GRSE also signed deals with UAE-based Aries Marine LLC for building offshore platforms and vessels. This move is expected to help modernize port facilities, improve multimodal logistics, and enable port-led industrial growth, said Sonowal. Another deal was signed between India's Larsen & Toubro (L&T) group and Norway's DNV for collaboration in areas including shipbuilding, said the statement. Speaking on the occasion, Sonowal said, 'As two proud maritime nations with extensive coastlines and rich oceanic traditions, we understand that the future of the blue economy hinges not just on development—but on sustainable, inclusive, and resilient growth. It gives me immense pleasure that many Indian companies are signing MoUs including those from Norway, further deepening our commitment to collaborate in maritime sector.' Sonowal added, 'Our governments are also working closely on green shipping corridors, decarbonization efforts, ship recycling, and capacity building. The India-Norway Task Force on Blue Economy stands as a cornerstone of this deepening engagement.' Mint reported on 29 April that the expenditure finance committee had cleared a ₹ 25,000-crore Maritime Development Fund for FY26, a project to lend long-term, low-cost financial support for indigenous ship-building and other blue water infrastructure projects. On 5 June, GRSE shares opened at ₹ 3,399, up from the previous close of ₹ 3,358.50, and surged 4.80% to reach a record high of ₹ 3,520.
Time of India
03-06-2025
- Business
- Time of India
Shipyards may lack punch as FinMin pitches for lower quantum in Ship Building Financial Assistance Policy 2.0, ET Infra
Advt Advt By , ETInfra Join the community of 2M+ industry professionals Subscribe to our newsletter to get latest insights & analysis. Get updates on your preferred social platform Follow us for the latest news, insider access to events and more. The much-awaited Ship Building Financial Assistance Policy 2.0 will likely see a lower quantum of aid for different categories of ships than the one mooted by the Ministry of Ports , Shipping and Waterways with the Ministry of Finance pitching for a lesser percentage, a move that is expected to hurt local shipbuilders while competing with global yards for to the proposal piloted by the Ministry of Ports, Shipping and Waterways, shipyards would be entitled to get 20 per cent extra as government aid on the cost of constructing a normal ship, 25 per cent as financial assistance for building special category vessels including oil, gas, chemical tankers and container ships and 30 per cent extra for green ships and other vessels with futuristic quantum of financial assistance will be static for the duration of the scheme that will run through March 2035 with possible extension up to 2047 to give 'long term visibility' to the yards while booking the Ministry of Finance is said to have advocated a lower quantum of financial assistance for building ships: 15 per cent for normal ships, 20 per cent for large ships and 25 per cent for specialised vessels including green ships, potentially chopping off 5 per cent from each of the categories suggested by the Ministry of Ports, Shipping and Waterways, sources revamped Ship Building Financial Assistance Policy was appraised in March by the Expenditure Finance Committee (EFC), headed by Secretary (Expenditure) in the Ministry of Finance, basis which the Ministry of Ports, Shipping and Waterways has prepared a note for the consideration of the Union Cabinet Finance Minister Nirmala Sitharaman announced a ₹25,000 crore Maritime Development Fund , a revamped Ship Building Financial Assistance policy, credit note for shipbreaking in Indian yards and infrastructure status to large ships in the February 1 Union Budget.'For long term financing of the maritime industry, a Maritime Development Fund with a corpus of ₹25,000 crore will be set up,' Nirmala Sitharaman said in her Budget speech to Parliament. This will be for distributed support and promoting Ship Building Financial Assistance scheme will be revamped to address cost disadvantages, Sitharaman said. This will also include credit notes for shipbreaking in Indian yards to promote the circular large ships above a specified size will be granted infrastructure status to help access long-term, low-cost funds, Sitharaman pledged while unveiling the the existing Ship Building Financial Assistance scheme that started from April 1, 2016, for a ten-year period, the quantum of aid is reduced by three percentage points every three years, starting with 20 per cent during the first three years, 17 per cent for the subsequent three years, 14 per cent for the next three years and 11 per cent in the tenth the Ministry of Ports, Shipping and Waterways recently amended the norms for implementing the Ship Building Financial Assistance scheme by removing the cap of ₹40 crore for constructing a non-specialised ship within three years from the date of the amendment, the Ministry also retained the quantum of aid at 14 per cent instead of the 11 per cent agreed earlier for the 10th year of the scheme that ends in March 2026 after a ten-year shipbuilders lobbied for removing the ₹40 crore cap on financial assistance per ship, saying that the upper limit was introduced when the shipbuilding prices were low.'However, due to various factors impacting supply chains, raw materials and equipment pricing, the global ship building prices have increased by about 80 percent,' said an executive with a private new regulatory guidelines for lowering carbon emission and emphasis on using green fuels have forced change in technology and the resultant higher capital investment for building a result, ships that were built at, say, ₹100 crore are currently costing more than ₹200 crore. Indian shipyards are now aiming to build ships of higher value.'The financial assistance for such high value vessels will exceed ₹40 crore at 14 per cent itself. If the vessels being built are capable of running on alternate fuels or are hybrid, then the cap of ₹40 crore will be of very low value and will be insufficient for local yards to compete with Chinese and other Southeast Asian shipbuilders who also receive substantial support from their respective governments,' the private shipyard executive were of the view that the removal of ₹40 crore cap will help India secure high value shipbuilding projects, boosting export value and higher shipyards reckon that a lower quantum of financial assistance preferred by the Finance Ministry in the revamped scheme would hinder their ability to compete with Chinese and South Korean yards for holds less than 1 per cent (0.06 per cent) of the global shipbuilding market and is ranked 20th in the industry but aims to break into the top 10 ranking by 2030 and top 5 by has the lowest labour costs - a key factor deciding a nation's competitive position in the labour-intensive shipbuilding this advantage has not translated into cost effectiveness because of factors such as reliance on import of key raw materials used in making ships and higher financing costs. India's dependence on imports for most of the inputs consumed in shipbuilding puts cost pressure on local shipbuilding yards suffer from systematic cost and price disadvantages of around 25-35 per cent compared to South Korea, Japan, Vietnam, Indonesia, Malaysia and Philippines, among other cost differential is sought to be offset through the financial assistance China, being one of the cheapest steel makers in the world, helps its yards to reduce costs and lower shipbuilding prices in the global market.
