The government is set to scale up the proposed Maritime Development Fund (MDF) to ₹70,000 crore—nearly three times the allocation announced in the February Budget—to accelerate growth in shipbuilding, ship repair, port-linked infrastructure, and shipping tonnage, The Economic Times reported, citing multiple sources.
The Expenditure Finance Committee (EFC), chaired by the finance ministry’s expenditure secretary, has already cleared the proposal, with Cabinet approval expected soon. The MDF will follow a blended finance model, comprising 49% concessional capital from the government (including contributions from state-owned major ports) and 51% commercial capital from multilateral and bilateral lenders as well as sovereign funds. It will offer long-term, low-cost financing through instruments with varied returns and terms to attract a diverse pool of investors.
Government estimates suggest India’s maritime sector will require $885–940 billion in investment by 2047—covering $388 billion for shipping tonnage, $260 billion for green vessels, $224 billion for next-generation ports, and $18 billion to establish India as a global shipbuilding and repair hub.
The recently concluded monsoon session of Parliament (ending 12 August) marked a “watershed moment” for the sector, passing four key legislations—the Merchant Shipping Bill, Coastal Shipping Bill, Carriage of Goods Bill, and Bills of Lading Bill. Additionally, the Indian Ports Bill, replacing the 117-year-old Indian Ports Act, cleared the Lok Sabha. “It’s a landmark event,” said Ports Secretary T.K. Ramachandran, highlighting the transformation underway.
The EFC has also approved a revamped Ship Building Financial Assistance scheme, incentives for shipbreaking in Indian yards, development of shipbuilding clusters, and infrastructure status for large vessels. Proposed subsidies include 15% for standard ships up to ₹100 crore, 20% for advanced vessels above ₹100 crore, and 25% for green ships.
India has set ambitious targets—to break into the global top 10 in shipbuilding by 2030 and the top 5 by 2047, competing with industry leaders like China, South Korea, and Japan. “India does not have the luxury to procrastinate,” said Antony Prince, CEO of G T R Campbell Marine Consultants Ltd. Dr. Ranjan Varghese of Steel Ships stressed the need to “build up infrastructure, expand shipbuilding capacity, and shake up the banking industry” to meet Prime Minister Narendra Modi’s vision.
