In a landmark move to boost India’s shipbuilding and maritime ecosystem, the Union Cabinet on Wednesday approved a ₹69,725-crore package aimed at strengthening domestic capacity, modernising infrastructure, and advancing the nation’s strategic self-reliance at sea.
The package, anchored on a four-pillar approach, will focus on expanding shipyard development, enhancing technical capabilities and skilling, extending long-term financing, and introducing legal, taxation and policy reforms to build a robust maritime infrastructure.
Financial support and schemes
Under the package, the Shipbuilding Financial Assistance Scheme (SBFAS) has been extended until March 31, 2036, with a corpus of ₹24,736 crore. The scheme also introduces a Shipbreaking Credit Note with an allocation of ₹4,001 crore. A National Shipbuilding Mission will be set up to oversee and coordinate the rollout of these initiatives.
The government has also approved the creation of a Maritime Development Fund (MDF) with a corpus of ₹25,000 crore. This includes a Maritime Investment Fund of ₹20,000 crore, with 49% government participation, and an Interest Incentivisation Fund of ₹5,000 crore to lower the cost of debt and improve financing for projects.
Additionally, the Shipbuilding Development Scheme (SbDS), with a budgetary outlay of ₹19,989 crore, will expand domestic shipbuilding capacity to 4.5 million gross tonnage annually. It will also support mega shipbuilding clusters, infrastructure expansion, the creation of an India Ship Technology Centre under the Indian Maritime University, and provide risk coverage, including insurance support for shipbuilding projects.
Economic and strategic impact
The government estimates the package will unlock 4.5 million gross tonnage of shipbuilding capacity, attract investments worth around ₹4.5 lakh crore, and generate nearly 30 lakh jobs. Beyond economic benefits, the initiatives are expected to reinforce India’s energy and food security by strengthening supply chain resilience and maritime routes.
In a push for Make in India, large ships have been included in the harmonised master list of infrastructure. Commercial vessels with a gross tonnage of 10,000 or more, under Indian ownership and flag, will qualify for infrastructure status. Similarly, commercial vessels of 1,500 gross tonnage or more, built in India and under Indian ownership and flag, will also receive the status.
Maritime backbone
Highlighting India’s long maritime legacy, the government noted that shipping remains vital to the economy, carrying nearly 95% of trade by volume and 70% by value. The Cabinet said the new package would not only transform the sector but also bolster India’s geopolitical resilience, advancing the vision of Aatmanirbhar Bharat and positioning the nation as a competitive force in global shipping and shipbuilding.
