Setting Sail India’s Shipbuilding Revival

Overview

Anchored in tradition and powered by technology, India’s shipbuilding landscape is poised for global recognition. India’s maritime sector has historically served as a vital link connecting the subcontinent to global trade routes, with centuries of seafaring and commerce shaping its economic foundation. India’s shipbuilding tradition dates back to the Indus Valley Civilization, with archaeological evidence from sites like Lothal (in present-day Gujarat) indicating the existence of dockyards and maritime trade. Lothal’s dock is considered one of the world’s earliest known tidal docks.

Shipbuilding, often termed the “mother of heavy engineering”, plays a central role by generating employment, attracting investment, and strengthening national security and strategic independence. India’s shipbuilding sector creates strong economic impact; each investment boosts jobs 6.4 times and returns 1.8 times the capital, showing its power to drive growth and development. This industry holds significant promise for creating large-scale employment opportunities in remote, coastal, and rural regions. Its development and promotion are being prioritized as a key driver in advancing the vision of an Atmanirbhar Bharat.

Shipbuilding Sector Growth & Development

and employment opportunities positioning the sector as a key driver of economic growth and regional integration. As of November 2024, India has a fleet of 1,552 Indian-flagged vessels, totalling 13.65 million Gross Tonnage (GT).

• MoUs and Collaborations: India is advancing its shipbuilding and maritime capabilities through strategic partnerships, infrastructure expansion, and financial collaborations. These efforts aim to strengthen domestic manufacturing, reduce reliance on foreign fleets, and promote sustainable growth across the sector.

1. Shipping Corporation of India and oil PSUs signed an MoU to form a vessel-owning JV (Joint Venture), reducing dependence on foreign fleets and boosting demand for Indian-built ships.

1. MoUs were signed between major ports and coastal states to develop shipbuilding clusters with joint investments, aiming to position India among the top five global shipbuilding nations by 2047. These hubs will integrate shipyards, R&D, MSMEs, and green innovation for sustainable marine engineering.

1. Cochin Shipyard and Mazagon Dock signed MoUs with Tamil Nadu agencies to set up major shipbuilding complexes, including a ₹15,000 crore facility with one million GT annual capacity and large-scale job creation.

1. Sagarmala Finance Corporation signed MoUs with key financial institutions to unlock diverse funding for green shipbuilding, fleet upgrades, and maritime logistics, blending global climate finance with domestic capital to build a robust investment ecosystem.

1. Cochin Shipyard and HD Korea Shipbuilding have partnered to build large commercial vessels in India, supported by CSL’s new dry dock and a planned ₹3,700 crore fabrication facility in Kochi, expected to generate thousands of jobs and boost MSME-linked supply chains.

Shipbuilding Sector Revitalization

Recent government announcements in September, 2025 for the shipbuilding sector focus on expanding domestic capacity, improving access to long-term financing, and creating a globally competitive ecosystem. These measures aim to generate large-scale employment, attract investment, and strengthen India’s strategic and economic resilience through modern infrastructure and policy reforms.

• Pillar 1: Shipbuilding Financial Assistance Scheme – The scheme, which is also seen as a foundational pillar, aims to bring together India’s indigenous shipbuilding capabilities and maritime innovation. With an outlay of ₹24,736 crores, it serves as a foundational pillar to catalyze domestic shipbuilding capabilities and maritime innovation. It integrates targeted incentives, strategic missions, and lifecycle support to strengthen India’s shipbuilding ecosystem.

• Pillar 2: Maritime Development Fund (₹25,000Cr) – The Maritime Development Fund aims to strengthen the backbone of India’s EXIM trade, which relies heavily on maritime transport – handling 95% of trade by volume and 65% by value. Despite its strategic importance, the sector faces persistent challenges in accessing affordable finance. Addressing these barriers is essential to unlock the full potential of India’s maritime economy.

• Pillar 3: Shipbuilding Development Scheme (₹19,989 crore) – A long-term support has been planned to boost shipbuilding through better infrastructure, safety measures, and risk management.

• Pillar 4: Legal, policy and process reforms – As part of legal, policy, and process reforms, large ships have been accorded infrastructure status to enable easier access to affordable financing, while coordinated efforts are underway to boost domestic shipbuilding through demand aggregation. A series of legislative updates have also been introduced to modernize maritime laws and strengthen regulatory frameworks.

• Effects of Reform – The reforms aim to elevate India’s shipping and port infrastructure to global standards, driving substantial employment, investment, and expansion in shipbuilding and maritime capacity. They also promise a significant boost in vessel count and port throughput, strengthening the sector’s overall competitiveness.

Conclusion:

India’s shipbuilding sector is entering a promising phase of growth, supported by a series of progressive initiatives and policy reforms. These measures aim to modernize infrastructure, enhance domestic manufacturing capabilities, and attract global investment, laying a strong foundation for long-term development. By focusing on innovation, sustainability, and skill development, the sector is well-positioned to meet the strategic goals outlined in Maritime India Vision 2030. Furthermore, its expansion aligns seamlessly with the broader national aspiration of Viksit Bharat 2047, contributing to economic resilience, employment generation, and global competitiveness. With continued collaboration between industry and government, India’s shipbuilding industry is set to become a key pillar of the country’s maritime strength and a driver of inclusive growth.