“The fund is expected to provide financing for freight financing, aiming to increase the number of ships marked by India to 20% of the global cargo volume by 2047,” a senior official told ET. “By 2030, the MDF aims to generate investments of up to Rs 1.5 lakh in the transport sector.”
Larger financial aid will seek to support the production of large vessels in the country. MDF will supplement this to support port upgrades.
MDF announced in Budget 2025-26 that it aims to support offshore industry financing in India through equity or debt securities. The Centre will contribute 49% of the total funds to major port authorities and other government weapons.
According to Vivek Merchant, director of Swan Defense and Heavy Industry, domestic industries are looking to provide more incentives for green shipbuilding and hybrid technologies from the policy of transformation.
“Indian private shipyards should also export ships provided to Indian Defence Forces or to friendly foreign countries,” the merchant said.
In addition to MDF, it is expected to receive final approval for more financial support for domestic shipbuilding soon.
“Incentives to manufacture large vessels, such as those in the Intercontinental Container Movement, will be approved,” the official said.
The existing domestic shipyard financial aid policy was launched in December 2015 for shipbuilding contracts signed between April 1, 2016 and March 31, 2026. It focuses on supporting the development of dedicated vessels, such as wind farm facilities and green fuel-powered vessels.
“We will go far beyond the existing plans to better prepare global trade for India’s shipbuilding industry,” the official said.
In addition to these two measures, there is also a plan to build a ship-building credit note soon. It will incentivize ship scrapping by issuing scrap credit notes reimbursable to purchase new locally manufactured ships.
