Govt may back green transition of inland vessels, tugboats with ₹15,000 cr VGF
₹15,000-crore viability gap funding (VGF) plan for companies to shift to greener vessels for inland water transport over the next 10 years, said two persons aware of the development. “The concept of VGF and other incentives for turning Indian maritime segment green is under formulation and consideration," one of the people cited above said on condition of anonymity, adding that the Inland Waterway Development Council (IWDC) is working on finalizing the scheme for this green transition, which would be similar to the FAME scheme for promotion of green automobiles.
"It should be rolled out soon after getting approval from the finance ministry," the person added. Currently, diesel is the primary fuel for vessels, ferries and tugboats plying on inland waterways and on certain coastal routes.
The financial support to be extended under the VGF scheme is based on an estimate done by the shipping ministry, the first person cited above said. Queries sent to ministry of ports, shipping and waterways and the finance ministry remained unanswered till press time.
“Converting diesel-run vessels to greener fuels such as LNG/CNG, electricity, green hydrogen, green methanol and more is essential for the sector," said Pushpank Kaushik, CEO, Jassper Shipping, a global logistics and ocean freight shipping company based in Hyderabad. “The VGF will make these projects more viable and attractive for private investors." Overall, the shipping ministry has envisaged several key interventions, including promoting use of renewable energy, reducing air emissions, optimizing water usage, improving solid waste management and reducing carbon emission per tonne of cargo handled by 30% by 2030 and 70% by 2047, in its plan to de-carbonize the sector.
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