Shipping Corp, GE Shipping, Cochin Shipyard: Shipping stocks trade higher; here is what you need to know

Last seen, SCI shares were trading over 1% higher at ₹235.10 apiece on the NSE, while GRSE was up 1.7% at ₹2,778. Cochin Shipyard was trading 2% higher at ₹1,933.40, and Mazagon Dock was trading 1% higher at ₹2,973.90 on the NSE.

The stocks gained as the Union Cabinet on Wednesday approved a ₹69,725 crore package to revitalise India’s shipbuilding and reduce dependence on foreign ships as part of the government's plan to regain the country's maritime power.

According to an official statement, the package introduces a four-pillar approach designed to strengthen domestic capacity, improve long-term financing, promote greenfield and brownfield shipyard development, enhance technical capabilities and skilling, and implement legal, taxation, and policy reforms to create a robust maritime infrastructure.

Under the package, the Shipbuilding Financial Assistance Scheme (SBFAS) will be extended until March 31, 2036, with a total corpus of ₹24,736 crore.

"The scheme aims to incentivise shipbuilding in India and includes a Shipbreaking Credit Note with an allocation of ₹4,001 crore. A National Shipbuilding Mission will also be established to oversee the implementation of all initiatives," the statement said.

In addition, the Maritime Development Fund (MDF) has been approved with a corpus of ₹25,000 crore to provide long-term financing for the sector.

"This includes a Maritime Investment Fund of ₹20,000 crore with 49% participation from the government of India and an Interest Incentivisation Fund of ₹5,000 crore to reduce the effective cost of debt and improve project bankability," the statement said.

Furthermore, the statement said the Shipbuilding Development Scheme (SbDS), with a budgetary outlay of ₹19,989 crore, aims to expand domestic shipbuilding capacity to 4.5 million gross tonnage annually, support mega shipbuilding clusters, expand infrastructure, establish the India Ship Technology Centre under the Indian Maritime University, and provide risk coverage, including insurance support for shipbuilding projects.

Last week, Prime Minister Narendra Modi made a strong pitch for 'Atmanirbharta' in the shipping sector, saying India pays a staggering $75 billion, or approximately ₹6 lakh crore, every year to foreign shipping companies for their services.

"Till 50 years ago, our trade was carried out by 40% ships made in India, but this has now come down to just 5%," the Prime Minister had pointed out.

India holds 0.06% of the total global shipbuilding market and is ranked 20th in the industry but aims to break into the top ten ranking by 2030 and the top 5 by 2047.

Data also show that the share of export-import (EXIM) cargo carried on Indian ships reduced sharply from 71% in 1987-88 to just 5% in 2022-23.

Shipping Sector Overview

The National Maritime Development Programme, Maritime India Vision 2030, and Sagarmala Programme have planned investments exceeding $82 billion to improve port infrastructure and operational efficiencies.

Significant reforms include amending the Major Port Authorities Act and fostering autonomy and efficiency among major ports. Innovation is a key focus, supported by the Sagarmala Innovation and Startup Policy, which encourages the integration of advanced technologies like AI and IoT to streamline operations.

Infra status for large ships

Early this month, in a bid to promote Make in India, the government included large ships in the harmonised master list of infrastructure.

Commercial vessels having a gross tonnage of 10,000 or more, which are under Indian ownership and flag, will be qualified to get infrastructure status.

Besides, the commercial vessels having a gross tonnage of 1,500 or more which are built in India and are under Indian ownership and flag will get the status.

Large ships are included in the Harmonised Master List of Infrastructure sub-sectors by insertion of a new item in the category of transport and logistics, the finance said in a gazette notification dated September 19.

The provision to include large ships above a specified size in the infrastructure harmonised master list (HML) has been announced in the Budget 2025-26.

The infra tag allows certain benefits, including access to easier overseas borrowings, the ability to raise funds through tax-free bonds, tax concessions, access to dedicated lenders such as IIFCL, and debt funds.