Facing the adverse effects of economic recession, the shipping industry has and is, to some extent, passing through a dark dismal phase; a lightning of hope is yet to shine. Many banks have stopped funding the industry. Left with no option, the Indian National Shipowners’ Association appealed to the Ministry to create a corpus of INR 10,000 crore to provide credit to the shipping companies using which they can acquire new vessels. The Finance Ministry approached the Indian Banks Association (IBA) and requested them to form a Working Group to study the proposal of funding to the shipping companies. Accordingly, a Working Group was formed and, in turn, it also formed a small group of executives from its member banks to study the issue of funding. As a consequence, the IBA asked the shipping companies in need of funds to approach individual banks for negotiation; it also pointed out that the industry body, the INSA, cannot have a role to play in the issue. Mr.G.K.Vasan explained thus the situation that led to the formation of a small group of executives from IBA to look into the question of funding to the shipping companies.
Sunday, 9 September 2012
Shipping companies to negotiate with individual banks for funds, IBA
Facing the adverse effects of economic recession, the shipping industry has and is, to some extent, passing through a dark dismal phase; a lightning of hope is yet to shine. Many banks have stopped funding the industry. Left with no option, the Indian National Shipowners’ Association appealed to the Ministry to create a corpus of INR 10,000 crore to provide credit to the shipping companies using which they can acquire new vessels. The Finance Ministry approached the Indian Banks Association (IBA) and requested them to form a Working Group to study the proposal of funding to the shipping companies. Accordingly, a Working Group was formed and, in turn, it also formed a small group of executives from its member banks to study the issue of funding. As a consequence, the IBA asked the shipping companies in need of funds to approach individual banks for negotiation; it also pointed out that the industry body, the INSA, cannot have a role to play in the issue. Mr.G.K.Vasan explained thus the situation that led to the formation of a small group of executives from IBA to look into the question of funding to the shipping companies.
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