The Union Cabinet, led by PM Narendra Modi, has approved a massive Rs 69,725-crore initiative to give India’s shipbuilding and maritime sector a major push, I&B Minister Ashwini Vaishnaw announced on September 24.

"The package introduces a four-pillar approach designed to strengthen domestic capacity, improve long-term financing, promote greenfield and brownfield shipyard development, enhance technical capabilities and skilling, and implement legal, taxation, and policy reforms to create a robust maritime infrastructure," the government said in a statement.

A key part of the plan is the continuation of the Shipbuilding Financial Assistance Scheme until 31 March 2036, with a total allocation of Rs 24,736 crore. This includes a Shipbreaking Credit Note worth Rs 4,001 crore, aimed at encouraging more shipbuilding within India. A National Shipbuilding Mission will also be created to oversee these initiatives and ensure effective execution.

To support long-term investment, the Cabinet approved the Maritime Development Fund with a corpus of Rs 25,000 crore. This includes a Maritime Investment Fund of Rs 20,000 crore, with 49% funded by the Government of India, and an Interest Incentivization Fund of Rs 5,000 crore to lower borrowing costs and make projects more bankable.

The Shipbuilding Development Scheme, with nearly Rs 20,000 crore in funding, will expand domestic shipbuilding capacity to 4.5 million Gross Tonnage annually, support mega shipbuilding clusters, enhance infrastructure, establish the India Ship Technology Centre under the Indian Maritime University, and provide risk coverage, including insurance support for projects.

The government estimates that the package could unlock 4.5 million Gross Tonnage of shipbuilding capacity, generate close to 30 lakh jobs, and attract investments worth roughly Rs 4.5 lakh crore into India’s maritime industry.