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In a major push to revive India’s maritime and shipbuilding sector, the Union Cabinet approved a ?69,725 crore package (September 2025) anchored on a comprehensive 4-Pillar Approach. The initiative aims to transform India into a global hub for shipbuilding and shipping services, enhance maritime self-reliance, and contribute to the vision of Aatmanirbhar Bharat.

Background

India’s maritime sector supports 95% of the nation’s trade by volume and 70% by value, making it a critical pillar of economic and strategic security. Recognized as the “mother of heavy engineering industries,” shipbuilding plays a pivotal role in employment generation, technological innovation, and defence capability. The new package seeks to address long-standing gaps in financing, infrastructure, and capacity to strengthen domestic shipyards and maritime logistics.

Objectives

• Expand domestic shipbuilding capacity to 4.5 million Gross Tonnage (GT) by 2036.
• Generate nearly 30 lakh employment opportunities.
• Mobilize ?4.5 lakh crore in investments.
• Build resilient maritime supply chains ensuring national, energy, and food security.
• Advance India’s position as a competitive and sustainable maritime economy.

The Four Pillars of the Package

1. Shipbuilding Financial Assistance Scheme (SBFAS)

• Extended till: 31 March 2036
• Corpus: ?24,736 crore
• Purpose: Incentivize shipbuilding within India by providing financial support to Indian shipyards.
• Key Feature: Introduction of a Shipbreaking Credit Note worth ?4,001 crore to encourage sustainable ship recycling and capacity utilization.

2. Maritime Development Fund (MDF)

• Corpus: ?25,000 crore
• Components:
  • Maritime Investment Fund: ?20,000 crore, with 49% Government of India participation.
  • Interest Incentivization Fund: ?5,000 crore to reduce the cost of borrowing and improve project bankability.
• Objective: Provide long-term financing for shipbuilding, port infrastructure, and related logistics services.

3. Shipbuilding Development Scheme (SbDS)

• Outlay: ?19,989 crore
• Aim: Expand India’s domestic shipbuilding capacity and support mega shipbuilding clusters.
• Key Features:
  • Establishment of the India Ship Technology Centre under the Indian Maritime University (IMU).
  • Support for greenfield and brownfield shipyards.
  • Insurance and risk coverage for shipbuilding projects.
  • Focus on skill development and adoption of advanced shipbuilding technologies.

4. National Shipbuilding Mission and Reforms

• A National Shipbuilding Mission will coordinate implementation and monitor outcomes of all initiatives under the package.
• Focus areas include:
  • Taxation, legal, and policy reforms to streamline procedures.
  • Capacity enhancement through modern shipyard development.
  • Human resource and skill training to strengthen India’s maritime workforce.
  • Promotion of green and sustainable shipbuilding practices aligned with global standards.

Expected Impact

• Unlock 4.5 million GT of annual shipbuilding capacity.
• Create nearly 30 lakh direct and indirect jobs across the maritime ecosystem.
• Boost investment inflows of ?4.5 lakh crore into ports, shipyards, and allied industries.
• Enhance strategic autonomy and reduce dependence on foreign shipbuilders.
• Strengthen geopolitical resilience, ensuring continuity of India’s trade, energy, and food supply chains during global disruptions.
• Foster innovation, sustainability, and competitiveness in line with “Make in India” and “Blue Economy” objectives.