Guidelines For Two Shipbuilding Schemes With Rs 44,700 cr Outlay Notified

New Delhi: In a bid to strengthen India’s domestic shipbuilding capacity, the ministry of ports, shipping and waterways (MoPSW) has notified guidelines for two major shipbuilding schemes with a total outlay of over Rs 44,700 crore. The initiative introduces graded support for small normal, large normal, and specialised vessels, with stage-wise disbursement linked to defined milestones and backed by security instruments, according to the government.

As per an official statement, the two initiatives — the Shipbuilding Financial Assistance Scheme (SBFAS) and the Shipbuilding Development Scheme (SbDS) — are aimed at strengthening the country’s domestic shipbuilding capacity and improving global competitiveness. “These guidelines create a stable and transparent framework that will revive domestic shipbuilding, boosting forward and backward linkages,” Union minister Sarbananda Sonowal said in the statement.

Under the SBFAS, which has a total corpus of Rs 24,736 crore, the government will provide financial assistance of 15-25 per cent per vessel, depending on the category of the vessel. While in the SbDS, a budgetary outlay of Rs 19,989 crore will focus on long-term capacity and capability creation. “The scheme also provides for the establishment of a National Shipbuilding Mission to ensure coordinated planning and execution of shipbuilding initiatives,” the official statement said.

“Both the schemes like SBFAS and SbDS will remain valid until March 31, 2036, with an in-principle extension envisaged up to 2047. Together, the schemes are expected to generate employment, promote indigenous technology development and strengthen India's maritime security and economic resilience,” the statement said.

The government also introduces a ship-breaking credit note, 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. “Independent valuation and milestone-based assessments have been made mandatory to strengthen governance and ensure efficient use of public funds,” the statement said.

Over the next decade, the statement further said that SBFAS is expected to support shipbuilding projects worth about Rs 96,000 crore, stimulate domestic manufacturing, and generate employment across the maritime value chain. “The scheme provides for the development of green-field shipbuilding clusters, expansion and modernisation of existing brown-field shipyards, and the establishment of an India Ship Technology Centre under the Indian Maritime University to support research, design, innovation and skills development,” it said.

Under SbDS, it said, greenfield shipbuilding clusters will receive 100 per cent capital support for common maritime and internal infrastructure through a 50:50 Centre-state special purpose vehicle, while 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. “With the creation of modern infrastructure and a skilled workforce, commercial shipbuilding capacity is projected to rise to about 4.5 million gross tonnage per annum by 2047,” it added.