Cabinet greenlights Rs 70,000 crore package to rejuvenate shipbuilding, maritime sector

The government initiative is expected to generate nearly 30 lakh jobs

The Union Cabinet on Wednesday approved around ₹70,000 crore package for shipbuilding and maritime sector.

“In a transformative push for maritime self-reliance, the Cabinet approved a package to rejuvenate India’s shipbuilding and maritime sector. This historic move will unlock 4.5 million gross tonnage capacity, generate jobs, and attract investments,” Prime Minister Narendra Modi said in a social media post.

According to a government statement, the package comprises of a four-pillar approach designed to strengthen domestic capacity, improve long-term financing, promote greenfield and brownfield shipyard development, enhance technical capabilities and skilling, and implement legal, taxation and policy reforms to create a robust maritime infrastructure.

It is expected to to generate nearly 30 lakh jobs, and attract investments of approximately ₹4.5 lakh crore into India’s maritime sector.

Food security

“Beyond its economic impact, the initiative will strengthen national, energy, and food security by bringing resilience to critical supply chains and maritime routes,” the statement said.

Under this package, the Shipbuilding Financial Assistance Scheme will be extended until March 31, 2036 with a total corpus of ₹24,736 crore. The scheme aims to incentivise ship building in India and includes a Shipbreaking Credit Note with an allocation of ₹4,001 crore.

“A National Shipbuilding Mission will also be established to oversee the implementation of all initiatives,” the statement said

Long-term financing

In addition, the Maritime Development Fund has been approved with a corpus of ₹25,000 crore to provide long-term financing for the sector. This includes a Maritime Investment Fund of ₹20,000 crore with 49 per cent participation from the Central Government and an Interest Incentivisation Fund of ₹5,000 crore to reduce the effective cost of debt and improve project bankability.

Furthermore, “the Shipbuilding Development Scheme, with a budgetary outlay of ₹19,989 crore, aims to expand domestic shipbuilding capacity,” the statement added.

Today, the statement said, the maritime sector remains a backbone of the Indian economy, supporting nearly 95 per cent of the nation’s trade by volume and 70 per cent by value.

At its core lies shipbuilding, often described as the “mother of heavy engineering”, which not only contributes significantly to employment and investment but also enhances national security, strategic independence, and the resilience of trade and energy supply chains.

Published on September 24, 2025