India to Launch ₹25,000 Crore Maritime Fund and Shipbuilding Reforms

NEW DELHI: The Ministry of Shipping is finalizing schemes aimed at revitalizing the shipbuilding industry, including the establishment of a 25000 cr Maritine Development Fund. This fund will provide low-cost, long-term financing options to bolster the maritime sector. Union Minister for Ports, Shipping, and Waterways, Sarbananda Sonowal, stated that the ministry has conducted extensive studies and gathered input from various stakeholders to support shipbuilding initiatives. Key features of the proposed schemes include an updated Shipbuilding Financial Assistance Policy with incentives for green ships, shipbreaking credit notes, and the creation of an apex body to oversee the implementation of these reforms.

The Ministry of Shipping is finalizing schemes aimed at revitalizing the shipbuilding industry, including the establishment of a ₹25,000 crore Maritime Development Fund. This fund will provide low-cost, long-term financing options to bolster the maritime sector.
Union Minister for Ports, Shipping, and Waterways, Sarbananda Sonowal, stated that the ministry has conducted extensive studies and gathered input from various stakeholders to support shipbuilding initiatives. Key features of the proposed schemes include an updated Shipbuilding Financial Assistance Policy (SBFAP 2.0) with incentives for green ships, shipbreaking credit notes, and the creation of an apex body to oversee the implementation of these reforms.
India's shipping sector has seen positive growth, with a 22% increase in Indian-flagged vessels over the last decade, reaching a total of 1,526 ships by 2023-24. According to ministry data, shipbuilding in FY24 recorded a 19% year-on-year increase, resulting in 26,412 gross tonnage (GT) constructed.
The new Maritime Development Fund aims to address the decline in the share of overseas cargo carried by Indian-flagged vessels and reduce reliance on foreign fleets. Sonowal highlighted that the fund is expected to stimulate ship acquisition, create jobs, enhance economic security, and support forex and GDP growth.

The SBFAP 2.0 will offer special incentives for ships utilizing low-carbon fuels or green hydrogen. Additionally, reforms in the ship-breaking sector are under consideration, including issuing credit notes to shipowners for vessels scrapped in Indian yards, which can be used toward the construction of new vessels in India.
The ministry is also focusing on capacity building, with proposals for a national center to enhance shipbuilding skills through courses, apprenticeships, and internships. Incentives for research and development in the shipbuilding sector and support for the establishment of new facilities and ancillary industries are also being explored.
These initiatives aim to strengthen India's shipbuilding capabilities and position the country as a significant player in the global maritime industry.