Piyush Goyal, Union minister of power and coal, on Friday mooted that an equity corpus of Rs 5,000 crore should be set up, with the involvement of domestic and international private equity (PE) funds, to promote private sector investment in the maritime sector.
“We could set up a small equity fund and allow an international investment manager to come and run that professionally. The Shipping Corporation (of India), the port trusts and power & coal companies could all seed the fund, maybe with $50 million each, and build a $250-million base capital and leverage that to raise another $1 billion, to provide an equity support to people wanting to come and invest in India. Let us look for innovative solutions, try and encourage investment,” Goyal said, while speaking on inland water transportation and coastal shipping at the second day of the Maritime India Summit.
The minister said the equity corpus can fast-track the private sector investment and provide much needed comfort to private investors, especially due to active involvement of government companies.
“This is the time for India to buy ships and further strengthen shipping infrastructure, when the Baltic indices are at all-time lows. The power and coal ministries are happy to do long-term contracts with Indian and international shipping companies through a competitive bidding process whoever gives a best rate. This is to support Indian shipping sector to add capacities,” Goyal said.
The minister also hoped the Indian shipping industry can help reduce import of thermal coal by the power and coal sector. "India continues to import a lot of thermal coal. I would ideally like to completely stop the import of coal over the next two or three years. Let us see whether shipping can come to save us from those imports. We have already reduced imports by about Rs 28,000 crore last year and have the ability to further reduce them by about Rs 40,000 crore. We can work in partnership and save precious foreign exchange," he said.
Source: Business StandardPrevious Next