Union cabinet approves ₹69,725 cr package to boost India’s shipbuilding and maritime infra
New Delhi: The Union cabinet on Wednesday unveiled a landmark ₹69,725 crore package to strengthen India’s maritime sector, aiming to build indigenous shipbuilding capabilities and modernise the country’s shipping ecosystem.
The move follows Finance Minister Nirmala Sitharaman’s budget announcements earlier this year and seeks to revitalise shipyards and allied infrastructure.
The package includes a revamped Shipbuilding Finance Assistance Programme (SBFAP) worth ₹24,736 crore, a ₹25,000 crore Maritime Development Fund (MDF), and a Shipbuilding Cluster Development Scheme (SbDS) with an allocation of ₹19,989 crore.
Together, these initiatives form a four-pillar strategy to enhance domestic capacity, long-term financing, technical skill development, and policy reforms, creating a robust maritime infrastructure.
Union Information and Broadcasting Minister Ashwini Vaishnaw said the decade-long initiatives are expected to induce investments of ₹4.5 trillion and generate over 2,500 vessels.
The SBFAP will run until March 2036, providing incentives for shipbuilding in India, including a Shipbreaking Credit Note of ₹4,001 crore, allowing shipowners to offset the cost of new vessels against the scrap value of old ships.
Assistance levels range from 15% for vessels under ₹100 crore, 20% for larger vessels, and 25% for green, hybrid, and specialised vessels.
The Maritime Development Fund will provide long-term financing for the sector, with a ₹20,000 crore Maritime Investment Fund and a ₹5,000 crore Interest Incentivization Fund to lower borrowing costs and bridge project financing gaps.
The fund will also support equity participation in projects linked to India’s blue economy.
The Shipbuilding Development Scheme aims to expand domestic shipbuilding capacity to 4.5 million gross tonnage annually, support mega shipbuilding clusters, set up the India Ship Technology Centre under the Indian Maritime University, and offer risk coverage and insurance support for shipbuilding projects.
Capital allocation includes ₹9,930 crore for greenfield clusters and ₹8,261 crore for brownfield expansions, with an additional ₹1,443 crore set aside for risk coverage and ₹305 crore for capability development.
The government expects the package to unlock 4.5 million gross tonnage in shipbuilding capacity and generate close to 3 million jobs.
Beyond its economic impact, the initiative will enhance national, energy, and food security, strengthen strategic supply chains, and boost India’s geopolitical resilience—aligning with the vision of Aatmanirbhar Bharat.
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