The ministry of ports, shipping, and waterways (MoPSW) is in discussions with the finance ministry on these measures, officials said.
“The planned changes are in line with demands from the domestic shipping industry to become globally competitive,” a senior official told ET.
The official said India will prioritise local manufacturing of larger high-end ships oriented towards intercontinental trade.
The MoPSW has suggested lowering or completely removing the withholding tax on income of foreign headquartered original equipment manufacturers (OEMs) engaged in the shipbuilding industry, the official said.
Exemption for income of Indian seafarers on domestic flagged ships from Tax Deducted at Source (TDS) has also been sought to bring them at par with seafarers on foreign flagged ships, the official added.Basic customs duty (BCD) exemption for capital goods and components required for ship building has also been pitched, the official added.The finance ministry, which is firming up the contours of the budget to be presented on February 1, will take a final call on the proposals after weighing revenue considerations.
Talks are also underway with global shipbuilding companies to establish local manufacturing presence in India.
Support for financing of shipbuilding and recycling initiatives are planned in 2025. India has already drawn up plans for three mega shipbuilding and repair clusters. The ongoing shipbuilding financial assistance programme is also being enhanced and extended beyond its 2026 deadline.
The official said a ₹30,000 crore Maritime Development Fund is on the anvil. This will be supplemented by a credit note scheme that will offer incentives to ship owners to scrap old vessels and build replacement ships domestically.
Content Source: economictimes.indiatimes.com