India currently imports a substantial portion of its containers from China since it lacks a stable market for container production.
In order to enhance domestic manufacturing and decrease its reliance on China for shipping-grade containers, the government is reportedly preparing a new production-linked incentive (PLI) scheme. As per a report, if launched, this PLI scheme will encourage indigenous companies to produce containers and boost India's container manufacturing industry.
The allocation for the scheme is expected to come from some of the savings made from the existing PLI schemes. As per a report by the Business Standard, a panel of secretaries led by cabinet secretary Rajiv Gauba, opted to reinvest some of the savings worth Rs 11,484 crores in the new PLI schemes.
Container supplies from China reportedly suffered significantly during the COVID-19 pandemic. This resulted in a tremendous rush in container markets around the world. As per the report, an official claimed that the container market was adversely affected by global trade uncertainties rather than the general slowdown in the economy.
“Moreover, supply chains of different nations did not follow a uniform trajectory of slowdown or growth, which is why container prices became so volatile. The pandemic continued to evolve and some markets where demand was expected to rise showed the opposite results and vice-versa,” Business Standard quoted the official as saying.
The report added that the centre is considering revising the scheme's structure and the scope of the incentives as global container costs are already declining from the COVID peak. The official reportedly made it clear that this is currently only in the discussion stage.