Big Booster Dose Of Rs 69,725 Crore Package To Shipbuilding Sector

2025-09-25 02:11:28

(MENAFN- KNN India) New Delhi, Sep 25 (KNN) The Union Cabinet has approved a Rs 69,725 crore package to strengthen India's shipbuilding industry.

The plan aims to place India among the world's top 10 shipbuilding nations by 2030 and in the top 5 by 2047.

The move is expected to reduce dependence on foreign shipping, lower freight costs, and enhance India's maritime strength.

India's shipping sector is crucial as about 95% of trade by volume and 70% by value moves through the seas. However, the country accounts for only 0.07% of global shipbuilding tonnage, and just 5% of export-import cargo is carried on Indian-owned or flagged ships.

This reliance on foreign ships leads to annual outflows of nearly Rs 6 lakh crore, creating both economic and strategic risks.

The package has three major components. The Shipbuilding Financial Assistance Scheme (SBFAS), with an outlay of Rs 24,736 crore, will support shipyards, provide credit for shipbreaking, and fund the National Shipbuilding Mission to oversee implementation.

The Maritime Development Fund (MDF), worth Rs 25,000 crore, includes a Maritime Investment Fund where the government will hold 49% equity, along with an Interest Incentivisation Fund offering up to 3% interest support.

The Shipbuilding Development Scheme (SbDS), with Rs 19,989 crore, will support new clusters, expand existing facilities, and establish an India Ship Technology Centre.

The government expects this initiative to create more than 2.2 million jobs by 2047 through shipbuilding and related industries. In addition, five key maritime bills were recently passed in Parliament to streamline regulations.

The government has also granted“infrastructure status” to large vessels, allowing easier access to financing. Discussions are ongoing for GST exemptions on vessel registration and repair services, along with tax relief for Indian seafarers.

This comprehensive package is seen as a strategic opportunity for India, especially at a time when shipbuilding activity is shifting from traditional hubs like Korea and Japan to emerging economies.

(KNN Bureau)

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