Will work with banks to meet shipping sector’s credit needs: FM

FM promises to work with banks to meet shipping sector's credit needs; expansion of HML may become quicker. Banks to understand sector's needs & extend credit, not wait for categorisation as infrastructure.

Finance Minister Nirmala Sitharaman said on Thursday that expansion of the country’s harmonised master list of infrastructure sectors may become quicker going forward, and promised to work with banks to meet the shipping sector’s credit needs.  In this year’s Union Budget, the Minister had announced an expert committee to review the list of sectors granted the infrastructure tag with a view to suggesting a classification and financing framework.

Stating that she was seized of the concern about shipping not being a part of the infrastructure sectors’ list, the Minister said the expert committee constituted to relook at the harmonised master list (HML) would streamline the understanding of infrastructure.

“The framework being developed by this committee would be instrumental in updating the HML from time to time and not wait for another committee.,” the FM said. “But the framework will give the idea of how periodically you can go about changing and categorizing relevant sectors as infrastructure itself. So time won’t be lost, it can be done at a good speed,” she asserted. 

Ms. Sitharaman was speaking at a session on maritime financing, insurance and arbitration, where a senior shipping ministry official flagged that banks and infra financiers were not keen to fund shipping vessels as they were not considered an ‘infrastructure’ sector, and that the level of insurance for the sector was also inadequate. 

Ms. Sitharaman assured that government would make sure banks understand the need of the sector, and deal with it, not waiting for the categorisation as infrastructure “because today, our banks are in a position to take big ticket credit extensions.”