In a major boost to India’s maritime sector, the Ministry of Ports, Shipping and Waterways (MoPSW) has notified guidelines for two key shipbuilding initiatives with a combined financial outlay of over Rs 44,700 crore. The measures are aimed at strengthening domestic shipbuilding capacity, enhancing global competitiveness and creating a robust maritime manufacturing ecosystem.

The two initiatives — the Shipbuilding Financial Assistance Scheme (SBFAS) and the Shipbuilding Development Scheme (SbDS) — are designed to provide both immediate financial support and long-term infrastructure and capability development for the sector.

Under the SBFAS, which has a total corpus of Rs 24,736 crore, the government will extend financial assistance ranging from 15 per cent to 25 per cent of the contract value per vessel. The support will vary depending on the category of vessels, including small normal, large normal and specialised ships. Disbursement will be linked to clearly defined construction milestones and backed by suitable security instruments.

The scheme also introduces incentives for series orders, encouraging shipyards to undertake bulk construction and improve cost efficiency. To strengthen governance, independent valuation and milestone-based assessments have been made mandatory to ensure transparent and efficient utilisation of public funds.

The second initiative, the Shipbuilding Development Scheme (SbDS), with a budgetary outlay of Rs 19,989 crore, focuses on long-term capacity and capability creation. It provides for the development of greenfield shipbuilding clusters, expansion and modernisation of existing brownfield shipyards, and creation of advanced shipbuilding infrastructure.

Under SbDS, greenfield clusters will receive 100 per cent capital support for common maritime and internal infrastructure through a 50:50 Centre–state special purpose vehicle. Existing shipyards will be eligible for 25 per cent capital assistance for brownfield expansion of critical infrastructure such as dry docks, shiplifts, fabrication facilities and automation systems.

The guidelines also provide for the establishment of a National Shipbuilding Mission to ensure coordinated planning and effective execution of shipbuilding programmes. A shipbreaking credit note has also been introduced, under which ship owners scrapping vessels at Indian yards will receive a credit equivalent to 40 per cent of the scrap value, linking ship recycling with new ship construction and supporting a circular economy approach.

Union Minister Sarbananda Sonowal said the guidelines create a stable and transparent framework that will revive domestic shipbuilding and strengthen forward and backward linkages across the maritime sector.