Indian cabinet has allotted $600 million in direct financial assistance for Indian shipyards over a ten year period. The subsidy will be used to discount the price after delivery of new vessels of any type by 20 percent.
The proposal gives Indian shipyards the right of first refusal for government purchases, as well as tax advantages. This comes as a shot in the arm for Indian yards struggling to find new orders in a tough shipping environment.
ABG Shipyard and Bharati Shipyard in Goa are worse off. The latter was forced into insolvency several years ago and is now under an asset restructuring company attempting to revive the business. Cochin Shipyards, one of India’s largest for government contracts in defence and commercial shipbuilding with a long order book and little debt, has a secure future.
The funds raised in the offering will be used in the construction of an International Ship Repair Facility (ISRF) and a dry dock for very large vessels, rigs and semi-submersibles.
Source: Business Standard