IFSCA lays foundation to strengthen ship financing, leasing in India

In a bid to boost maritime trade, International Financial Services Centres Authority is taking steps to strengthen ship acquisition, financing and leasing in India, a senior official said on Friday.

IFSCA, a statutory authority with a mandate to develop and regulate financial products, services and institutions in the International Financial Services Centres, has constituted a committee on the development of avenues for ship acquisition, financing and leasing activities from IFSC in India, she said.

"We have identified legal and regulatory provisions which are conflicting with each other in laws and have a bearing on different types of ship financing," IFSCA Committee on Ship Acquisition chairperson Vandana Aggarwal told PTI.

With the changes, ship financing is expected to witness a similar boom as seen in aviation financing, she said.

The committee has already submitted its report and the implementation of the recommendations is a work in progress, a senior official said.

Around six lessors are in the process of getting themselves registered with IFSC for ship-related financing. The government has already accepted and implemented several recommendations of the report known as SAFAL (Ship Acquisition Financing and Leasing)," the official said.

Aggarwal was in the city to attend the 12th edition of Shipping and Logistics Conclave organised by the Bengal Chamber of Commerce and Industry.

"The changes brought in the aviation financing from IFSC in the last few years have paved the way for 17 lessors registered here," Aggarwal said.

Each year, India is estimated to pay about USD 75 billion for seaborne freight to foreign shipping companies.

The share of Indian ships carrying the country's export-import cargo was about 6.53 per cent in the 2019-20 financial year.