In a significant step to support long-term financing in the maritime industry, Union Finance Minister Nirmala Sitharaman has proposed the establishment of a Maritime Development Fund with a corpus of Rs 25,000 crore.
Announcing this during her Union Budget 2025-2026 speech, the Finance Minister stated that the fund aims to provide distributed support and promote competition within the maritime sector. The government will contribute up to 49 per cent, while the remaining funds will be mobilized from ports and the private sector.
The Finance Minister called for revamping the Shipbuilding Financial Assistance Policy to address cost disadvantages. This will include Credit Notes for shipbreaking in Indian yards to promote the circular economy. Additionally, large ships above a specified size are proposed to be included in the Infrastructure Harmonized Master List (HML).
The Union Budget also seeks to facilitate Shipbuilding Clusters to enhance the categories, capacity, and range of ships. These clusters will include additional infrastructure, skilling programs, and technological support to develop the entire ecosystem. The Finance Minister also proposed the continuation of the Basic Customs Duty exemption on raw materials, components, consumables, and parts for ship manufacturing for another ten years. Similar provisions will be extended to the shipbreaking industry to enhance its competitiveness.
Highlighting the success of the Regional Connectivity Scheme UDAN, Sitharaman stated that a modified UDAN scheme will be launched to expand regional connectivity to 120 new destinations, targeting four crore passengers over the next decade. The scheme will also support the development of helipads and smaller airports in hilly, aspirational, and North Eastern districts. Furthermore, the government will facilitate infrastructure and warehousing upgrades for air cargo, including high-value perishable horticulture produce. Cargo screening and customs protocols will also be streamlined to enhance efficiency.
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Providing a major infrastructure boost to Bihar, the Finance Minister proposed the establishment of Greenfield airports to meet the state's growing aviation needs. These initiatives will complement the ongoing expansion of Patna Airport and the development of a brownfield airport at Bihta. Additionally, financial assistance will be provided for the Western Koshi Canal ERM Project, which will benefit farmers cultivating over 50,000 hectares of land in the Mithilanchal region of Bihar.
The proposed measures in the Union Budget 2025-26 aim to strengthen India's shipping and aviation sectors, bolster regional connectivity, and enhance infrastructure development across key states.
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