Synopsis
Finance Minister Nirmala Sitharaman has proposed the establishment of a ₹25,000 crore Maritime Development Fund in the Budget for 2025-26, aimed at enhancing financing for the maritime industry and boosting competition within the sector.Key Takeaways
- Establishment of a ₹25,000 crore Maritime Development Fund.
- Government contribution of up to 49 percent.
- Revamping of Shipbuilding Financial Assistance Policy.
- Inclusion of large ships in Infrastructure Harmonised Master List.
- Extension of Basic Customs Duty exemptions for shipbuilding materials.
New Delhi, Feb 1 (NationPress) Finance Minister Nirmala Sitharaman, during her presentation of the Budget for 2025-26, proposed the establishment of a Maritime Development Fund with a total corpus of ₹25,000 crore aimed at providing long-term financing for the maritime sector.
She emphasized that this fund is intended to bolster competition within the maritime industry. The government will contribute up to 49 percent, while the remaining funds will come from ports and private investments.
The Finance Minister also mentioned a revamp of the Shipbuilding Financial Assistance Policy to mitigate cost challenges. This will include Credit Notes for shipbreaking in Indian shipyards, promoting a circular economy.
Additionally, large vessels exceeding a certain size will be included in the Infrastructure Harmonised Master List (HML). The Union Budget aims to support the creation of Shipbuilding Clusters to diversify the types and capacities of ships, along with enhancing infrastructure, skills, and technology to develop the entire ecosystem.
Recognizing the lengthy gestation period of shipbuilding, the Finance Minister proposed extending the exemption of Basic Customs Duty on raw materials, components, and consumables for ship manufacturing for another ten years. Similar exemptions are suggested for shipbreaking to enhance competitiveness.
The government projects substantial demand from the Indian shipping sector, which, if effectively addressed by Indian shipyards, could create opportunities worth over $237 billion (₹20 lakh crore) by 2047, as stated by the Shipping Ministry.
A comprehensive strategy has been formulated to rejuvenate the shipbuilding and repair ecosystem in India, aligning with the ambitious Maritime India Vision 2030 (MIV 2030). This vision aims to elevate India's shipbuilding and repair ranking from over 20th to the top 10, with an ultimate goal of reaching the top 5 by the Amrit Kaal Vision 2047.
The government is pursuing an integrated approach to unite shipbuilding stakeholders through the development of Maritime Clusters.
