Prime Minister Narendra Modi´s ´Make in India´ initiative may come to the rescue of an industry that has its fate closely tied to economic cycles - shipbuilding. The shipping ministry has asked the central bank to relax rules allowing shipbuilding companies which are sitting on huge losses to go in for a second round of debt restructuring.
´We are not in favour of a bailout package for the sector, but we want to address the systemic issues,´ said a senior government official on the ministry´s proposal. Banks have to write off part of their loans if the first round of debt recast fails. The shipping ministry wants the Reserve Bank of India to ease this rule for fund-starved shipbuilders so that they could undertake a fresh round of restructuring and raise finance as they try to revive business.