The government has announced operational guidelines for two significant shipbuilding initiatives with a total outlay of Rs 44,700 crore. One of these initiatives is the Shipbuilding Financial Assistance Scheme (SBFAS), which has a corpus of Rs 24,736 crore. This scheme will offer financial aid ranging from 15% to 25% per vessel, based on the vessel category.
The SBFAS includes graded support for various types of vessels, with disbursements tied to specific milestones and supported by security instruments. It also provides incentives for series orders. Over the next ten years, the SBFAS aims to back shipbuilding projects valued at around Rs 96,000 crore, promoting local manufacturing and creating jobs in the maritime sector.
Another initiative, the Shipbuilding Development Scheme (SbDS), with a budget of Rs 19,989 crore, focuses on enhancing long-term capacity and capability. This scheme involves developing greenfield shipbuilding clusters, upgrading existing shipyards, and establishing an India Ship Technology Centre under the Indian Maritime University to support research, design, innovation, and skills development.
Union Minister of Ports, Shipping and Waterways, Sarbananda Sonowal, highlighted that these guidelines mark a significant policy shift in India’s shipbuilding sector under Prime Minister Narendra Modi’s leadership. The frameworks aim to revitalize domestic shipbuilding, support the ‘Make in India’ initiative, attract substantial investments, and enhance India’s maritime capabilities, aligning with the vision of Viksit Bharat and Aatmanirbhar Bharat.
Under the SbDS, greenfield shipbuilding clusters will receive full capital support for common maritime and internal infrastructure through a Centre–State special purpose vehicle. Existing shipyards can avail 25% capital assistance for expanding critical infrastructure like dry docks, shiplifts, fabrication facilities, and automation systems. The disbursements will be milestone-based and overseen by independent evaluation bodies.
Moreover, the SbDS incorporates a Credit Risk Coverage Framework that offers government-backed insurance to mitigate pre-shipment, post-shipment, and vendor-default risks, enhancing project bankability and financial resilience. The government projects that with modern infrastructure and a skilled workforce, India’s commercial shipbuilding capacity could reach approximately 4.5 million gross tonnage per annum by 2047. Both the SBFAS and SbDS will be effective until March 31, 2036, with a potential extension up to 2047.
