The Ministry of Ports, Shipping and Waterways (MoPSW) has notified the operational guidelines for two major shipbuilding initiatives — the Shipbuilding Financial Assistance Scheme (SBFAS) and the Shipbuilding Development Scheme (SbDS) — aimed at strengthening India’s domestic shipbuilding capacity and enhancing its global competitiveness. Together, the schemes involve a total outlay of ₹44,725 crore and provide a transparent, accountable framework for implementation.
Union Minister for Ports, Shipping and Waterways Sarbananda Sonowal said the guidelines mark a decisive policy reset for the sector. He noted that Prime Minister Narendra Modi’s leadership has created a stable and predictable framework to revive domestic shipbuilding, strengthen forward and backward linkages under the Make in India initiative, attract large-scale investment and build world-class capacity. According to the minister, the measures will help position India as a major maritime nation aligned with the vision of Viksit Bharat and Atmanirbhar Bharat.
The Shipbuilding Financial Assistance Scheme, with a total corpus of ₹24,736 crore, provides financial assistance ranging from 15 per cent to 25 per cent of the vessel cost, depending on the category. The scheme introduces graded support for small normal, large normal and specialised vessels, with stage-wise disbursement linked to defined milestones and supported by security instruments. Incentives have also been included for series orders to encourage scale and efficiency.
SBFAS also provides for the establishment of a National Shipbuilding Mission to ensure coordinated planning and execution of shipbuilding initiatives. A Shipbreaking Credit Note mechanism has been introduced under which ship owners scrapping vessels at Indian yards will receive a credit equivalent to 40 per cent of the scrap value. This credit can be used for new ship construction, linking ship recycling with fresh capacity creation and supporting a circular economy. Independent valuation and milestone-based assessments have been made mandatory to strengthen governance and ensure optimal use of public funds. Over the next decade, the scheme is expected to support shipbuilding projects worth around ₹96,000 crore and generate significant employment across the maritime value chain.
The Shipbuilding Development Scheme, with a budgetary outlay of ₹19,989 crore, focuses on long-term capacity and capability creation. It provides for the development of greenfield shipbuilding clusters, modernisation and expansion of existing brownfield shipyards, and the establishment of an India Ship Technology Centre under the Indian Maritime University to support research, design, innovation and skill development.
Under SbDS, greenfield shipbuilding clusters will receive full 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. All disbursements will be milestone-based and monitored by independent evaluation agencies. The scheme also includes a Credit Risk Coverage Framework offering government-backed insurance for pre-shipment, post-shipment and vendor-default risks to improve project bankability.
With the creation of modern infrastructure and a skilled workforce, India’s commercial shipbuilding capacity is projected to rise to about 4.5 million gross tonnage per annum by 2047, according to the ministry.
Sonowal said that strengthening shipbuilding and maritime capabilities is central to rebuilding India’s industrial confidence, ensuring that growth is anchored in self-reliance, skills and global competitiveness. Both schemes will remain valid until March 31, 2036, with an in-principle extension envisaged up to 2047.
The approved guidelines have been published on the ministry’s official website to enable structured and transparent implementation of the schemes.
