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If things go according to plan, the Gujarat International Finance Tec-City (GIFT) in Gandhinagar might house the country's first maritime finance centre. The Export Import Bank of India (Exim Bank) is planning an innovative finance model, whereby a consortium of banks would function out of GIFT and operate as a single-window facility for financing in the maritime sector.
The idea is to float maritime bonds to attract the investor community into the sector. The centre is likely to be developed around the Korean model, where public investment is mobilised by issuing debt and equity instruments to raise capital as well as channelise it into the industry.
Talking to media here Yaduvendra Mathur, chairman and managing director of Exim Bank, said: "We're going to float maritime bonds that would be draw the investor community. There would be a consortium of banks that would function out of the GIFT City in Gandhinagar, which would operate as a shipping or maritime financing centre. This would be a single-window facility." The bonds could be listed on the Singapore Exchange.
Earlier this year, Exim Bank had raised around $500 million by selling fixed rate unsecured bonds that were listed on the Singapore Exchange. According to Mathur, this is the model for the airline industry worldwide as well as the Korean and European model for maritime financing. "GIFT City is the ideal location as it is the upcoming international finance centre," he said.
As an export credit agency, Exim Bank is interested in increasing its shipping portfolio. As of now, its exposure to the shipping sector stands at Rs8,000 crore, of which 35 per cent of the loans have gone for corporate debt restructuring (CDR). Mathur pegged the shipping portfolio of China's Exim Bank at $200 billion.
"We are proposing to have a Shipping Investment Trust, much like the Real Estate Investment Trust. India's share in global shipbuilding is a meagre one per cent now, and it could get a huge boost if such a plan could be worked out," he added.
Indian banks have an exposure of Rs90,000-1 lakh crore to the shipping industry, of which 35 per cent of the loans have gone for corporate debt restructuring. According to estimates, out of this, around Rs40,000 crore is for port projects, a similar amount for shipyard projects, and Rs10,000-15,000 crore for shipping companies.
Indian Rail Port Company to be set up for last-mile connectivity
The shipping ministry has taken up an initiative to have a company that would work on last-mile connectivity projects between Indian ports. Rajive Kumar, secretary, Ministry of Shipping, said a company called Indian Rail Port Company has been registered and the ministry is in the process to select the first managing director. "We hope to complete the process by July 31."
The company would take up last-mile connectivity projects first for the major ports, and eventually for the non-major ports. It will construct, operate and maintain rail and road infrastructure to facilitate connectivity for transportation of goods from ports in India.
Kumar said the first tranche would be contributed by the major ports and the initial equity is about Rs100 crore. Shipping secretary is the chairman of the company that would be head-quartered in Mumbai.
"We have identified 30 projects, and three detailed project reports (DPRs) are ready. We hope to start the tendering process by October and the balance DPRs would follow," he said.
