India is making a concerted push to emerge as a major global shipbuilding hub by 2047, following a series of budget-backed initiatives aimed at expanding domestic shipbuilding capacity, boosting ship recycling, and reducing dependence on foreign shipping lines, industry experts said at a policy roundtable in New Delhi.
Organised by the PHD Chamber of Commerce and Industry, the discussions focused on the implications of the Union Budget 2026–27 for the country’s maritime sector and the potential to reshape India’s maritime economy.
Susanta Kumar Purohit, chairperson of V.O. Chidambaranar Port Authority, highlighted the government’s strategy to position India as a competitive maritime nation through large financial commitments and institutional reforms. “The framework rests on four pillars — financing, capacity expansion, policy reform, and skill development — to strengthen the domestic maritime ecosystem,” he said.
Massive Financial Backing
At the center of the government’s plan is a Rs 69,725 crore maritime revitalisation package and a Rs 25,000 crore Maritime Development Fund, alongside an extension of the Shipbuilding Financial Assistance Scheme until 2036. The Ministry of Ports, Shipping and Waterways has also increased its budget allocation by 48% to Rs 5,164.8 crore, signalling a strong commitment to building domestic shipbuilding and maritime logistics capabilities.
India currently spends approximately Rs 6 lakh crore annually on freight payments to foreign shipping lines, a gap policymakers aim to bridge by strengthening domestic fleets and shipyards.
Flagship Industrial Projects
One of the key initiatives is the National Shipbuilding and Heavy Industries Park in Tamil Nadu, developed through a 50:50 joint venture between the port authority and the State Industries Promotion Corporation of Tamil Nadu (SIPCOT). The Rs 30,000 crore project will cover roughly 2,000 acres and is expected to become a major hub for shipbuilding and heavy engineering.
Industry experts said the park could foster a cluster-based ecosystem for ship construction, repair, and related manufacturing, potentially attracting private investment in a sector historically dominated by public shipyards.
Promoting Circular Economy in Maritime Sector
The government also unveiled the Shipbreaking Credit Note Scheme, which allows vessel owners to receive a credit note equal to 40% of the scrap value of ships recycled at Indian yards. These credits can be redeemed against the cost of constructing new vessels domestically.
“India has already made significant progress in ship recycling, with 106 yards at Alang complying with the Hong Kong International Convention on safe and environmentally sound ship recycling,” Purohit said.
Port Infrastructure and Sustainability
Upgrades to port infrastructure are also a central part of India’s maritime expansion plans. The Tuticorin-based port is investing Rs 15,000 crore in the Outer Harbour project to enhance cargo handling capacity and establish southern India as a competitive transshipment hub.
The port is also embracing green energy, with rooftop solar installations exceeding 1 megawatt and initiatives to produce green hydrogen, reflecting broader sustainability goals for the maritime sector.
Private Sector Participation to Accelerate
Industry representatives said government-backed financing and cluster-based development could help accelerate private sector participation in shipbuilding. Sandeep Wadhwa, head of the ports, shipping, and waterways committee at the chamber, noted that public shipyards have already delivered hundreds of vessels in recent years, and policy support is now aimed at scaling up industrial capacity across the broader maritime ecosystem.
Analysts at the roundtable said the next five years will be crucial in determining whether current policy momentum can translate into sustained growth in ship construction, recycling, and maritime manufacturing in India.
