The Union Cabinet, chaired by Prime Minister Narendra Modi, on Tuesday approved a comprehensive package of ₹69,725 crore aimed at revitalizing India’s shipbuilding and maritime ecosystem. The initiative introduces a four-pillar strategy to strengthen domestic capacity, improve long-term financing, promote shipyard development, enhance technical capabilities, and implement legal, taxation, and policy reforms.
Under the plan, the Shipbuilding Financial Assistance Scheme (SBFAS) has been extended until March 31, 2036, with a total corpus of ₹24,736 crore. This includes a Shipbreaking Credit Note of ₹4,001 crore and the creation of a National Shipbuilding Mission to oversee implementation. The scheme seeks to incentivize domestic shipbuilding, reduce project costs, and encourage technological adoption in shipyards across the country.
The package also introduces the Maritime Development Fund (MDF) with a total corpus of ₹25,000 crore, which will provide long-term financing for the sector. A Maritime Investment Fund of ₹20,000 crore will see 49% participation from the government, complemented by an Interest Incentivization Fund of ₹5,000 crore aimed at lowering the effective cost of debt and improving project bankability.
Further, the Shipbuilding Development Scheme (SbDS), with an outlay of ₹19,989 crore, is designed to expand domestic shipbuilding capacity to 4.5 million Gross Tonnage annually. The scheme will support the development of mega shipbuilding clusters, upgrade infrastructure, establish the India Ship Technology Centre under the Indian Maritime University, and provide risk coverage including insurance for shipbuilding projects.
The government expects the overall package to unlock 4.5 million Gross Tonnage of shipbuilding capacity, generate nearly 30 lakh jobs, and attract investments of around ₹4.5 lakh crore into India’s maritime sector. Officials noted that the measures will not only bolster economic growth but also enhance national, energy, and food security by strengthening supply chains and maritime routes.
Experts said the initiative will reinforce India’s geopolitical resilience and strategic self-reliance, advancing the government’s vision of Aatmanirbhar Bharat and positioning the country as a competitive player in global shipping and shipbuilding.
India’s maritime sector has historically been central to trade, supporting nearly 95% of the country’s trade by volume and 70% by value. Shipbuilding, often called the “mother of heavy engineering,” remains critical for employment, investment, national security, and the resilience of trade and energy supply chains.
The Cabinet’s approval marks a major step in modernizing India’s maritime infrastructure and promoting long-term competitiveness in shipbuilding, aligning with the government’s broader industrial and strategic priorities.
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