The government is considering setting up a maritime development fund with a view to providing low-cost, long-term financial support to the shipping sector, a senior government official said on Tuesday. Ministry of Ports, Shipping and Waterways Secretary T K Ramachandran at an event organised by industry body CII said, the government is also looking at granting infrastructure status to the shipping sector."The government is working to set up the Maritime Development Fund (MDF) for low-cost, long-term financing support," Ramachandran said.

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According to him, the two options for setting up an MDF are -- setting up a dedicated maritime vertical under the newly proposed development finance institution or constituting a standalone MDF as a company with majority ownership by a multilateral/ bilateral agency. Ramachandran further said the government is also considering notifying guidelines for setting up NBFCs at the International Financial Services Centre (IFSC) to undertake vessel financing/ leasing from IFSC.

The government is also looking at removing restrictions on foreign portfolio investors (FPIs) investing in Category I and Category II AIFs and amending Alternate Investment Fund (AIF) regulations to create a separate category of AIFs for investments in ship leasing companies. According to the secretary, the government is also considering removing restrictions on investment in ship leasing by insurance companies. He also said that the ports ministry is planning to extend the shipbuilding financial assistance policy for another 10 years. Ramachandran said his ministry is working on the development of shipbuilding & repair clusters at Mumbai, Kochi and Chennai. He said investment of Rs 75-80 lakh crore is envisaged in the maritime sector under the Blue Economy 2047 initiative.