The Indian government has removed the Rs 40 crore financial assistance cap for building non-specialised ships, while maintaining a 14% aid rate for the scheme’s final year, ending in March 2026. Initiated on April 1, 2016, the Ship Building Financial Assistance scheme saw a gradual reduction in aid over ten years, starting at 20% and decreasing every three years. With rising global shipbuilding prices—reportedly up by 80%—local shipbuilders lobbied for this change due to increased costs driven by supply chain issues and new regulatory demands for greener technologies.
The Ministry of Ports, Shipping and Waterways has adjusted the scheme to support local shipbuilders in securing high-value projects, essential for boosting export value and creating jobs. In addition to lifting the cap, the financial assistance rate will remain higher than previously planned for the scheme’s last year.
Further modifications entail extended delivery deadlines for contracts involving multiple vessels. Ships within contracts for two to four vessels must be delivered within four years to qualify for aid, while contracts for more than four vessels allow for a six-year completion timeline under the new guidelines.
