India is set to establish a ₹250 billion ($2.9 billion) Maritime Development Fund to support its shipbuilding and repair industry, Finance Minister Nirmala Sitharaman announced in the Union Budget 2025.
Key Highlights
Long-Term Financing for Shipbuilding & Repairs
- 49% of the fund will be contributed by the government, while the rest will come from ports & private sector investment.
- The initiative aims to strengthen India’s maritime infrastructure and reduce dependence on foreign shipping.
Boosting India’s Shipping Fleet
- India’s shipping fleet has not kept pace with growing trade, increasing reliance on foreign carriers for energy imports & refined exports.
- A new shipping company will be set up with participation from Shipping Corporation of India (SCI) & oil refiners to expand India’s fleet.
- Following the announcement, SCI shares rose by 3.8%.
Shipbuilding Clusters & Ecosystem Development
- The government will promote shipbuilding clusters to expand ship categories & capacities.
- Infrastructure development will include skilling programs & technology upgrades to build a self-reliant maritime sector.
Incentives for Shipbreaking & New Vessel Construction
- Credit notes will be issued for shipbreaking at Indian yards to encourage scrapping of old vessels.
- Import tax exemption on inputs for shipbuilding & shipbreaking extended by 10 years.
Bottom Line
With this initiative, India aims to strengthen its maritime industry, reduce foreign freight costs, and enhance shipbuilding capabilities, aligning with PM Modi’s vision for a developed India by 2047.
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Source: Reuters
