India launches major initiative to expand shipbuilding and merchant fleet

India is launching a major strategic initiative to expand its shipbuilding and merchant fleet capabilities to reduce reliance on foreign shipping lines. The government has approved a financial package of ₹69,725 crore to develop shipbuilding capacity, financing, and skilled manpower. The long-term goal is to transform India into a global maritime manufacturing hub, aiming to rank among the top five shipbuilding nations by 2047.

Currently, India holds a 0.06 percent share of the global shipbuilding market, a sector dominated by China, Japan, and South Korea. To address this, the National Shipping Board (NSB) has proposed a five-year roadmap to add 100 vessels to the country’s merchant fleet. This plan focuses on fiscal reforms, regulatory streamlining, and improving the ease of doing business.

Reducing dependence on foreign carriers is a primary driver, as India currently pays approximately $75 billion annually in freight charges to foreign lines for commodities like crude oil, gas, and coal. Industry stakeholders noted that operating under the Indian flag is currently 16% to 20% more expensive than foreign flags due to taxes on ship imports, maintenance, and high domestic financing costs.