The government of India has allocated a budgetary support of USD 266mln to shipping sector in the interim budget presented by Interim Finance Minister Piyush Goyal.
The government has pitched for development of India’s Blue Economy with the Finance Ministry proposing an impressive USD 77mln under Sagarmala. This allocation was up from USD 53 mln (revised estimates) allocated during 2018-19.
Underlining importance of developing India’s 7,500 km long coastline and converting them into industrial hubs, India launched its flagship programme for port development and modernisation, Sagarmala, in 2015.
Sagarmala aims at promoting “port-led direct and indirect development” and augmenting infrastructure facilities to “transport goods to and from ports quickly, efficiently and cost-effectively”.
Sagarmala Programme has identified more than 400 projects worth billions for implementation, during 2015-2035, across the areas of port modernisation and new port development, port connectivity enhancement, port-linked industrialisation and coastal community development. Out of these, 199 focus projects are phased out up to 2019
However, a report in Money Control pointed out that India may have to wait before it sees its first Coastal Economic Zone (CEZ) taking concrete steps as the government didn’t announce any major fiscal incentive for them during the interim budget of 2019-20.
Even as Piyush Goyal, interim finance minister presenting the budget on February 1, praised India’s blue economy, no measures were announced.
“India’s long coastline has the potential of becoming the strength of the economy, particularly through exploitation of the Blue Economy, to ensure better standards and quality of life for a large number of people living in the coastal areas,” Goyal said.
Sector players were hoping for tax exemption to CEZs on the lines of exemptions given to industries set under Special Economic Zones (SEZ).