New Delhi: The government accorded the infrastructure status to “large ships" on Friday, bolstering the prospects of easier and cheaper financing for ship-building in India.
The move, announced in the Budget for 2025-26, also comes ahead of Prime Minister Narendra Modi’s visit to Gujarat on Saturday, where he is expected to launch major maritime, shipbuilding and ship repair projects.
A department of economic affairs notification said “large ships” is included in the harmonised master list of infrastructure sub-sectors by inserting it in the ‘transport and logistics’ category. It has also clarified on the expansion of the master list.
Modi will be in Bhavnagar (Gujarat) on Saturday. He will oversee an agreement between HD Korea Shipbuilding & Offshore Engineering Co (KSOE) and Cochin Shipyard Limited (CSL). Shipping Corporation of India, Indian Oil, Bharat Petroleum, and Hindustan Petroleum are also going to sign an agreement for vessel demand aggregation. Andhra Pradesh, Odisha, Gujarat, Maharashtra, and Tamil Nadu will also sign agreements for shipbuilding ecosystem development.
A large ship is defined as a commercial vessel having a gross tonnage of 10,000 or more, which are under the Indian ownership and flag. Those with a gross tonnage of 1,500 will also qualify if they are built locally under the Indian ownership and flag.
Infrastructure status would enable large ships to be used as collateral for loans, bolstering the flow of cheaper, long-term finances into shipbuilding at favourable terms for such companies, experts said.
These companies can also avail of relevant tax incentives. All these would encourage private players to get into building large ships, they said.
While shipyards held the infrastructure status earlier, large ships did not.
According to the Maritime India Vision 2030, Indian shipping companies struggle to grow tonnage due to difficulties in accessing required finance.
Apart from proposing the infrastructure status for large ships, the Budget for 2025-26 had also announced the setting up a Maritime Development Fund (MDF) of Rs 25,000 crore. This will directly benefit financing for ship acquisition.
It aims at boosting Indian flagged ships' share in the global cargo volume up to 20% by 2047. By 2030, MDF is aiming at generating around Rs 1.5 lakh crore investment in the shipping sector.
India is also eyeing the development of new shipbuilding clusters of 1.0 to 1.2 million gross tonnage each on the public-private partnership model.
Other changes
The notification also said the list of infrastructure sub-sectors include oil, gas, slurry, water supply and iron ore pipelines in the "Bulk Material Transportation Pipelines" category.
It's clarified that the strategic storage of crude oil is a part of the list, so are optic fibre/wire/cable networks which provide broadband internet services.
Data centre housed in a dedicated building for storage and processing of digital data applications with a minimum capacity of 5 MW of IT load is also made a part of the list.
The move, announced in the Budget for 2025-26, also comes ahead of Prime Minister Narendra Modi’s visit to Gujarat on Saturday, where he is expected to launch major maritime, shipbuilding and ship repair projects.
A department of economic affairs notification said “large ships” is included in the harmonised master list of infrastructure sub-sectors by inserting it in the ‘transport and logistics’ category. It has also clarified on the expansion of the master list.
Modi will be in Bhavnagar (Gujarat) on Saturday. He will oversee an agreement between HD Korea Shipbuilding & Offshore Engineering Co (KSOE) and Cochin Shipyard Limited (CSL). Shipping Corporation of India, Indian Oil, Bharat Petroleum, and Hindustan Petroleum are also going to sign an agreement for vessel demand aggregation. Andhra Pradesh, Odisha, Gujarat, Maharashtra, and Tamil Nadu will also sign agreements for shipbuilding ecosystem development.
A large ship is defined as a commercial vessel having a gross tonnage of 10,000 or more, which are under the Indian ownership and flag. Those with a gross tonnage of 1,500 will also qualify if they are built locally under the Indian ownership and flag.
Infrastructure status would enable large ships to be used as collateral for loans, bolstering the flow of cheaper, long-term finances into shipbuilding at favourable terms for such companies, experts said.
These companies can also avail of relevant tax incentives. All these would encourage private players to get into building large ships, they said.
While shipyards held the infrastructure status earlier, large ships did not.
According to the Maritime India Vision 2030, Indian shipping companies struggle to grow tonnage due to difficulties in accessing required finance.
Apart from proposing the infrastructure status for large ships, the Budget for 2025-26 had also announced the setting up a Maritime Development Fund (MDF) of Rs 25,000 crore. This will directly benefit financing for ship acquisition.
It aims at boosting Indian flagged ships' share in the global cargo volume up to 20% by 2047. By 2030, MDF is aiming at generating around Rs 1.5 lakh crore investment in the shipping sector.
India is also eyeing the development of new shipbuilding clusters of 1.0 to 1.2 million gross tonnage each on the public-private partnership model.
Other changes
The notification also said the list of infrastructure sub-sectors include oil, gas, slurry, water supply and iron ore pipelines in the "Bulk Material Transportation Pipelines" category.
It's clarified that the strategic storage of crude oil is a part of the list, so are optic fibre/wire/cable networks which provide broadband internet services.
Data centre housed in a dedicated building for storage and processing of digital data applications with a minimum capacity of 5 MW of IT load is also made a part of the list.
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