In a major push to strengthen India’s shipbuilding ecosystem, the government has approved the ‘Shipbuilding Development Scheme (SbDS)’ with a total corpus of ₹19,989 crore, including ₹9,930 crore earmarked for developing greenfield shipbuilding clusters. These clusters are expected to transform India into a global shipbuilding hub by 2030–31.
According to the draft implementation guidelines, greenfield shipbuilding clusters designed to achieve an aggregate output capacity of at least 1.2 million Gross Tonnage (GT) per annum within five years of establishment will be eligible for capital support under the scheme. This threshold will be assessed based on the combined installed capacity of all shipyards and industrial units operating within the cluster.
Cluster-Based Maritime Growth Model
Each greenfield shipbuilding cluster will be a coastal industrial zone integrating one or more shipyards, ancillary units, and shared maritime infrastructure such as breakwaters, basins, jetties, channels, and capability development centres, all managed through a Special Purpose Vehicle (SPV). The SPV may include participation from the Ministry of Ports, Shipping and Waterways (MoPSW), State Governments, and Port Authorities.
A greenfield shipyard, forming the core of each cluster, will encompass both marine and landside infrastructure — including dry docks, slipways, ship lifts, fabrication areas, utilities, and ancillary systems — enabling the construction and repair of various classes of vessels.
The scheme envisages that these clusters will become fully operational by FY 2030–31, with the government committing to meet liabilities up to six years post-2036, when the ten-year scheme concludes.
Eligibility and Governance Framework
Entities proposing a greenfield shipbuilding cluster must be legally registered Indian companies, public sector enterprises, or SPVs established in partnership with MoPSW or State Governments.
The lead shipyard or consortium partners must demonstrate at least five years of experience in shipbuilding, ship repair, or heavy engineering sectors.
Moreover, participating SPVs and shipyard partners must provide a binding undertaking not to divest, lease, or repurpose government-supported infrastructure for non-shipbuilding purposes for a minimum of ten years post completion, except with prior approval from the National Shipbuilding Mission (NSbM) — the central implementing authority of the scheme.
Capital Support and Project Financing
Capital support under SbDS will be provided as grant-in-aid for the development of common maritime and shipbuilding infrastructure within approved clusters.
Eligible components include:
Breakwaters, wave breakers, and tide-independent basins
Channel and basin development, dredging, and land reclamation
Area grading and internal infrastructure
Regional Shipbuilding Capability Development Centres
Common maritime assets such as barges and floating cranes
Utilities and land development
Common assets will qualify for funding only if owned and managed by the SPV and serving multiple shipyards. Yard-specific movable equipment will not be covered under the grant.
The balance project cost must be met through equity and loans from SPV partners, including private shipyard developers, State Governments, Port Authorities, or foreign collaborators — ensuring shared ownership and financial discipline.
Additionally, capital dredging, major reclamation, and foundational marine earthworks will be financed separately by State Governments or the SPV through PPP models such as Hybrid Annuity Mode (HAM) or EPC contracts with long-term O&M options.
State Incentives and Land Policy
Preference for government funding will be extended to projects proposed in coastal states offering land availability, policy facilitation, and co-funding commitments.
State Governments may further enhance project viability through tax rebates, fiscal incentives, and connectivity infrastructure.
Land developed under the scheme will be leased by the SPV to participating shipyard developers for a minimum of 50 years, on nominal or concessionary rent, in accordance with approved tender or concession frameworks.
Ancillary industry parcels within the cluster may be leased at commercial or market-linked rates, with lease revenues ring-fenced in escrow accounts for the maintenance and upgradation of common infrastructure.
Transparency and Oversight
The shipyard partner within each cluster will be selected through a transparent, competitive process based on technical competence, financial strength, shipbuilding experience, and employment generation potential.
All funds released will be on a milestone basis, with strict audit oversight by the Comptroller and Auditor General (CAG) to ensure accountability.
