 "Union Budget 2024: Govt puts focus on shipbuilding, cruise tourism reforms")
After experiencing supply chain shocks due to a lack of domestic ships and shipping lines during several global geopolitical turmoils, the Centre has now focused on shipbuilding and shipping reforms in the Union Budget to unlock a market with a potential of Rs 12 trillion.
Finance Minister Nirmala Sitharaman on Tuesday announced two initiatives for the maritime economy, stating that these will be important pillars of employment generation and skilling, which are central themes in this year’s Budget.
“Ownership, leasing and flagging reforms will be implemented to improve the share of the Indian shipping industry and generate more employment,” the FM said in her Budget speech.
To boost the domestic cruise industry, the FM also announced tax sops. The government will put in place a presumptive taxation regime for cruise ship operations of non-residents. Further, it has proposed to provide exemption for any income of a foreign company from lease rentals of cruise ships, received from a related company which operates such ships in India.
Union Minister for Ports, Shipping and Waterways Sarbananda Sonowal said the initiatives will help in creating employment opportunities.
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“The cumulative effect of these changes proposed in the Budget along with other initiatives of our ministry will be good for the industry. Under the Maritime Amrit Kaal Vision 2047 targets, our ministry will work to propel India from its current rank of 18 in global ship tonnage to top-5 by 2047, thereby creating jobs for Indian seafarers. Similarly, the aim is to push India from rank 22 in shipbuilding to top-5 by 2047, which will attract foreign capital in shipyards and offer various jobs in the manufacturing sector,” Sonowal said after the presentation of the Budget.
Shipbuilding is a mother industry in heavy engineering with a high multiplier for downstream and MSME sectors. Sonowal said that the current Budget proposals on skilling and support to MSMEs will be beneficial to develop the entire ecosystem for shipbuilding and repair. This will enhance infrastructure, boost employment, and position India as a global leader in maritime innovation, he added.