Centre to fund nearly 30% of national green shipping ventures

25 May 2023 CW Team

In a bid to expedite the green transition of Indian shipping, the Ministry of Ports, Shipping, and Waterways (MoPSW) announced that it planned to contribute approximately one-third of the financial backing for green shipping projects in the country.

According to the shipbuilding scheme initiated by the government, the ministry currently provides 20 percent of the funds for all vessels constructed by the industry, with a yearly reduction of 3 percent. However, in a move to encourage the development of vessels powered by alternative fuels, the ministry intends to increase its financial support to 30 percent of the project cost for green shipping.

The ministry stated, "The main objective is to inform the shipbuilding industry about the prioritisation of green ships."

As the announcement is recent, we only have a general idea of the policy. They are yet to finalise the complete policy, including aspects such as yearly reduction and the types of fuels covered.

At present, the green funding policy would solely apply to vessels and not encompass associated infrastructure.

It remains uncertain whether a new fund will be established for this scheme or if the ministry will utilise the remaining funds from the existing Rs 40 billion shipbuilding assistance scheme.

This decision was made during MoPSW's annual chintan shivir, presided over by Union Minister Sarbananda Sonowal. With this initiative, the ministry aspires to kick-start India's shipbuilding industry.

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