The government of India has approved a package encompassing a whopping ₹697.25 billion (approximately $7.86 billion) aimed at rejuvenating the South Asian nation’s shipbuilding and the overall maritime ecosystem.
As disclosed by India’s Ministry of Ports, Shipping and Waterways (MoPSW), the financing represents a four-pillar approach that was crafted with a vision to breathe new life into domestic production capacity, improve long-term funding, support greenfield and brownfield shipyard development, ‘enhance’ technical skills and implement legal, taxation and policy reforms to create a “robust” maritime infrastructure.
Under the scope of this package, officials from MoPSW explained that the Shipbuilding Financial Assistance Scheme (SBFAS) is to be extended until the very end of March 2036, with a total of ₹247.36 billion (roughly $2.79 billion) made available for this purpose.
As elaborated further, this particular scheme will endeavor to incentivize shipbuilding in India, with a Shipbreaking Credit Note available, including financing of ₹40.01 billion (around $451 million).
The Indian government noted that a National Shipbuilding Mission is planned to be established in order to oversee the implementation of all initiatives. Moreover, per the Ministry, the Maritime Development Fund, which the government initially unveiled earlier this year, has been given a formal stamp of approval.
This will reportedly include ₹200 billion (around $2.26 billion) that the Indian government will cover as well as an Interest Incentivization Fund of ₹50 billion (circa $563 million) to cut debt costs and improve project bankability.
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As informed, in addition to this, a shipbuilding development scheme (SbDS), with a budget of ₹199.89 billion (approximately $2.25 billion), will be set up to expand the domestic vessel construction capacity to 4.5 million gross tonnage annually, provide support to mega shipbuilding clusters and infrastructure expansion, and to create the India Ship Technology Center under the India Maritime University, providing risk coverage and insurance support for related projects.
Beyond the economic impact, this endeavor is anticipated to strengthen national and energy security by offering support to ‘essential’ supply chains and maritime routes.
MoPSW had previously announced these plans in March this year, when the ministry revealed that a staggering ₹2 trillion (around $23.8 billion) was planned to be splashed into revitalizing the nation’s vessel construction sector.
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The maritime sector in India remains a bedrock for the country’s economy, with estimates showing that the sector supports nearly 95% of trade by volume and 70% by value. In the face of increasingly stringent environmental regulations, India has increased its efforts to keep up, with multiple initiatives as well as partnerships underway.
For instance, Danish maritime transport giant Maersk and India’s largest shipbuilding and maintenance facility Cochin Shipyard Limited (CSL) teamed up in February 2025 to explore joint opportunities within the vessel repair, construction and maintenance landscape.
French major CMA CGM and its Switzerland-based counterpart MSC joined Maersk soon after, declaring they would also endeavor to help India to become a “global maritime hub.”
More recently, Norway’s marine technology company Kongsberg Maritime won a contract to deliver a fully integrated equipment package intended for the ‘first-ever’ electric tugboat in the South Asian country. The tug is part of India’s Green Tug Transition Program (GTTP), the ultimate target of which the goal is to shift to 50% of zero-emission tug operations by 2030 and fully green operations by 2047.