Why in news?
The Ministry of Ports, Shipping and Waterways released detailed guidelines for two schemes aimed at reviving India’s shipbuilding industry: the Shipbuilding Financial Assistance Scheme (SBFAS) and the Shipbuilding Development Scheme (SbDS). Together they have an outlay of about ₹44,700 crore and will remain in force until 31 March 2036.
Shipbuilding Financial Assistance Scheme
- Corpus: ₹24,736 crore, funded by the central government.
- Assistance: Grants of 15–25 percent of the contract price to domestic shipyards, varying by vessel type (small, large or specialised).
- Disbursement: Funds are released in stages tied to construction milestones, ensuring accountability.
- Other incentives: A Shipbreaking Credit Note allows shipowners who scrap vessels at Indian yards to receive 40 percent of the scrap value as a credit against future ship purchases. A National Shipbuilding Mission will coordinate policy and skill development.
Shipbuilding Development Scheme
- Outlay: ₹19,989 crore.
- Greenfield clusters: Establishes new shipbuilding clusters through a special‑purpose vehicle jointly owned by the Centre and states; the Centre’s share can cover up to 100 percent of capital costs.
- Brownfield upgrades: Provides 25 percent capital support for modernising existing shipyards to expand capacity and adopt greener technologies.
- Innovation and R&D: An India Ship Technology Centre will be created to foster research, design and skill development.
- Credit risk coverage: Government‑backed insurance for loans encourages banks to finance shipbuilding projects.
Aim and significance
- Boost capacity: Increase India’s commercial shipbuilding capacity to about 4.5 million gross tonnes per year by 2047.
- Strategic autonomy: A strong domestic shipbuilding sector reduces dependence on foreign yards for defence and commercial vessels.
- Employment and exports: Shipbuilding has a high multiplier effect, creating jobs in design, engineering and ancillary industries and potentially making India a competitive ship exporter.
Source: Press Information Bureau
