India’s revamped Ship Building Financial Assistance Policy 2.0 faces uncertainty.

The Finance Ministry proposes lower aid percentages—15% for normal ships, 20% for large ships, and 25% for green/specialised vessels—cutting 5% from the Ministry of Ports’ recommendation. This move could hurt domestic shipyards struggling with higher costs, global competition, and limited support. Local builders argue that the ₹40 crore cap is outdated due to rising shipbuilding costs, driven by inflation, supply chain issues, and green tech demands. Removing this cap is crucial for India to secure high-value orders and compete with well-subsidised shipbuilders in China and South Korea. Despite India’s cost-effective labour, dependence on imported materials and high financing costs undermine competitiveness. Currently holding just 0.06% of the global market, India aims to break into the top 10 by 2030. Industry stakeholders warn that reducing aid would stifle growth, limit global competitiveness, and hinder India’s ambitions in shipbuilding.