India is set to cater to global shipbuilding demand: Sarbananda Sonowal

India is set to cater to global demand for large ships, including very large crude carriers (VLCCs), container vessels, and Panamax vessels, according to Union minister for ports, shipping and waterways Sarbananda Sonowal.

Indian shipbuilders, through global tie-ups, including technology transfer and joint ventures, will cater to the global demand for large ships and are set to get more and more orders for these ships, which were never manufactured in the country before, he said while speaking about the ₹25,000 crore shipbuilding scheme in an interview with Mint.

In October 2025, the Centre approved a ₹70,000-crore shipbuilding and maritime development reform package built on four pillars.

The first is the ₹24,736-crore Shipbuilding Financial Assistance Scheme, comprising financial assistance, ship-breaking credit notes, and a National Shipbuilding Mission.

The second is a ₹25,000-crore Maritime Development Fund”> ₹25,000-crore Maritime Development Fund, including a ₹20,000-crore Maritime Investment Fund for equity and long-term financing and a ₹5,000-crore Interest Incentivization Fund offering a 3% interest subsidy on shipbuilding-related loans.

The third is a ₹19,989-crore Shipbuilding Development Fund to promote shipping and shipbuilding clusters, while the fourth focuses on legal, policy and process reforms to create a unified dispute-resolution and arbitration framework.

Sonowal said two of South Korea’s largest shipbuilding companies—HD Hyundai Heavy Industries and Samsung Heavy Industries—have shown interest in collaborating with Indian shipbuilders for developing these large vessels in the country. Mint reported on 28 November 2025 about Indian state-run refiners and shipbuilders’ plans to collaborate with South Korean counterparts to develop large crude carriers in India.

The minister said the Centre plans to transform the country’s maritime infrastructure into a high-capacity, future-ready ecosystem by raising overall port capacity from the present 2,771 million tonnes per annum (mtpa) in 2024-25 to about 3,500mtpa by 2029-20, including a planned capacity addition of roughly 514mtpa. The capacity augmentation would be achieved through a pipeline of major projects, including Vadhvan Port (200mtpa), the Tuna Tekra Container Terminal at Deendayal Port (35mtpa), and the multipurpose cargo berth at Tuna Tekra (18mtpa), among others.

He added the government would also operationalize 20 new national waterways over the next five years, including underdevelopment NW-5 in Odisha, which connects mineral-rich areas of Talcher and Angul and industrial centres like Kalinga Nagar to the Ports of Paradeep and Dhamra.

Shipbuilding is one of the main objectives of the government’s financial package for the shipping sector. What is the roadmap for bringing in global expertise and investments to the Indian shipbuilding sector?

Yes, the expectation is that the Indian shipbuilding industry will grow in a big way. Following the approval of the shipbuilding schemes in September 2025 by the government, the ports ministry has promulgated the guidelines for the schemes as well as launched a portal for shipyards to apply for benefits under the schemes.

We see existing shipyards planning to expand their facilities using funding provided under the shipbuilding development scheme, and new shipyards being set up in the country.

Furthermore, the industry has already won orders for the construction of several vessels from foreign buyers and shipping lines.

We expect many more orders for vessels that are presently not manufactured in the country, such as container vessels, VLCCs, Panamax vessels, specialized vessels, etc., with foreign collaboration through technology transfers or joint ventures.

What is the plan for expanding handling capacity and improving the efficiency at major ports?

The ministry’s goals for new projects and capacity and cargo additions are to raise overall port capacity from the present 2,771mtpa in 2024-25 to about 3,500mtpa by 2030, including planned capacity additions of roughly 514mtpa.

This will be achieved through a pipeline of major projects, including Vadhvan Port (200mtpa, under implementation, commercial operation date June 2029), the Tuna Tekra Container Terminal at Deendayal Port (35mtpa, February 2027), the multipurpose cargo berth at Tuna Tekra (18mtpa, April 2029), Tuticorin Outer Harbour at VOC Port (80mtpa, April 2028), Paradip Western Dock (30mtpa, October 2028), as well as capacity creation at non major ports such as Vizhinjam, Keni, Machilipatnam, Ramayapatnam, and Mulapeta.

These objectives are planned to be supported by the proposed Sagarmala 2.0 scheme.

How would the Budget 2026 announcements help the expansion and growth of India’s maritime sector?

The Union Budget 2026-27 marks a strategic inflexion point for India’s maritime sector, with a series of targeted announcements that build capacity, incentivise private participation and align with Maritime Amrit Kaal Vision 2047.

Key measures include a ₹10,000 crore Container Manufacturing Assistance Scheme (CMAS) over five years to create 0.75 million TEUs (twenty-foot equivalent) annual domestic capacity, supporting high-growth containerized cargo and generating ₹80,000 crore in market value with 3,000 direct and 50,000 indirect jobs.

Similarly, tax reforms extend International Financial Services Centre/Offshore Banking Units deductions to 20 years (then 15% rate), while customs duty exemptions on vessel imports are eased—for small vessels until 2028 and for large vessels indefinitely—to boost flagging and fleet augmentation.

What are the timelines and investment plans for new waterway systems in the country?

The government has committed to operationalizing 20 new national waterways within this period (five years), marking the most significant expansion since the National Waterways Act of 2016. This includes the development of NW-5 in Odisha, which connects mineral-rich areas of Talcher and Angul and industrial centres like Kalinga Nagar to the Ports of Paradeep and Dhamra. It has a huge cargo potential of 10 million tonnes by 2032 and 20 million tonnes by 2047.

Since 2014, approximately ₹6,434 crore has already been invested in developing waterway infrastructure, with major works such as fairway development, terminals, jetties, navigation systems, and multimodal connectivity. These efforts have delivered tangible outcomes, including a record 145.5 million tonnes of cargo movement on inland waterways in 2024-25, and 160 million tonnes in the current fiscal year to date.

Overall, our timelines and investments are structured to ensure that the new waterways are not standalone assets but fully integrated logistics corridors. As we implement the first tranche of the 20 waterways within five years, we expect significant private sector participation through fleet augmentation, terminal development, and associated multimodal logistics infrastructure.

Bharat Container Shipping Line (BCSL) is seen as a major strategic move amid geopolitical uncertainty and the shortage of ships and containers. What is the roadmap for its operationalization?

The establishment of the BCSL has been identified by the government as a strategic national priority. The entity is being structured as a joint venture anchored by the Shipping Corporation of India to accelerate the acquisition and ownership of Indian-flagged container vessels and reduce reliance on foreign shipping lines.

BCSL is envisaged to develop a fleet of around 51 container vessels over the next two decades, with a targeted capacity of about 0.6 million TEUs by 2045, through the phased induction of fuel-efficient, dual-fuel ships.

The MoU was signed on 3 February 2025. The proposed JV partners include SCI and CONCOR as anchor shareholders, with equity participation from Jawaharlal Nehru Port Authority (JNPA), V.O. Chidambaranar Port Authority, and Chennai Port Authority, and the remaining support to be provided through the Maritime Development Fund (MDF).

Following the signing of the MoU and incorporation of the JV, the first phase of vessel acquisition and operationalization of the BCSL is expected to be taken up in the near term.