The Union Cabinet of India, chaired by Prime Minister Narendra Modi, approved a package of ₹69,725 crore for India’s shibuilding and maritime sectors. This initiative aims to create 30 lakh jobs in the country.
The funding is part of a four-pillar approach designed to strengthen domestic capacity, improve long-term financing and promote greenfield and brownfield shipyard development, as per Union Information and Broadcasting Minister Ashwini Vaishnaw.
“We have made a commitment, and a major part of it is shipbuilding and the maritime sector. Today, a package of approximately ₹70,000 crore, to be precise, ₹69,725 crore, has been approved. This is a 10-year program. The importance of this program is well known. Shipbuilding is the mother of heavy engineering,” stated Vaishnaw.
“It is extremely important because starting shipbuilding also drives many other industries. It has multiple multiplier effects. When shipbuilding starts, it stimulates engine manufacturing, procurement of various materials, and the development of new materials,” the minister added.
Under the new package, the Shipbuilding Financial Assistance Scheme will be extended until 31 March 2036 with a total corpus of ₹24,736 crore. This, as per the minister, aims to encourage shipbuilding within India. The initiative also includes a Shipbreaking Credit Note with an allocation of over ₹4000 crore.
The cabinet has also approved the creation of a Maritime Development fund worth ₹25,000 crore, and a Shipbuilding Development Scheme worth ₹19,989 crore. The new reforms within the shipbuilding and maritime industries will be spread over the next ten years.
The key points of the new Shipbuilding Financial Assistance Scheme include:
- Financial assistance to shipyards to overcome the cost differential.
- Vessels valued below ₹100 crore will get 15%, while those above ₹100 crore will get 20% assistance.
- 25% assistance to special, green, hybrid or specialised vessels
- The ₹20,554 crore assistance will be provided until March 2036.
Meanwhile, the Ship-breaking Credit Note Scheme includes providing a credit note of 40% of the vessel’s scrap value when the vessel is scrapped in an Indian yard. The notes will be reimbursable against the cost of constructing a new vessel in an Indian shipyard. They will be stackable, transferable, and valid for a three-year period.
Through these steps, the government hopes to attract investments worth over ₹4.5 lakh crore to bolster India’s Aatmanirbhar Bharat initiative.
