Govt plans to offer incentives to boost shipbuilding industry

India plans to offer cash subsidies, lower taxes and other incentives to bolster its shipbuilding industry, two government sources said – part of an effort to reduce the pain of high freight rates for the nation’s manufacturers.

The plans include subsidies so that at least 50 new vessels can be built as well as the granting of “infrastructure status” to the industry which would help with financing from banks, said the government officials.

A 10 billion rupee ($123 million) maritime development fund is also likely to be established, they added, without providing further details.

Finance Minister Nirmala Sitharaman is expected to announce the plans when she presents the annual budget for 2023/24 to parliament on Feb. 1, a senior government official with the direct knowledge of discussions told Reuters.