Indian government tries to help shipyards
India’s Minister for Shipping Pon Radhakrishnan has called on the Reserve Bank of India (RBI) and the finance ministry to sanction special dispensations for five years up to 2020 for shipyards undergoing a first corporate debt restructuring (CDR), the SME Times said.
"Shipyards may need to opt for CDR to restructure their loans. However, when first restructuring fails, the loans become NPAs (non-performing assets) and hence bankers find it difficult to undertake repeated restructuring," the minister told parliament.
He said that shipping is highly capital intensive and depends largely on the debt market.
"Availability of loans has almost dried [up] and if any credit is available, it is at a very high cost and stringent terms," he said.