India Seeks International Financial Support for a ₹25,000 crore Maritime Infrastructure Expansion Plan
India Unveils Maritime Development Fund to Boost Maritime Sector
India has proposed a revamped Shipbuilding Financial Assistance Policy (SBFAP 2.0) with an outlay of ₹18,090 crore, aiming to strengthen domestic shipyards and enhance their global competitiveness. A key component of this initiative is the Maritime Development Fund (MDF), a dedicated blended finance vehicle designed to lower capital costs and attract investments into the maritime sector.
The MDF was officially announced at the Maritime Financing Summit 2025 held in New Delhi, aligning with India’s Maritime Amrit Kaal Vision (MAKV) 2047, which aims to position India as a leading global maritime power by enhancing shipbuilding, port infrastructure, and financial resilience.
Key updates on the MDF and related developments include:
- Investment and FDI liberalization: India now permits 100% Foreign Direct Investment (FDI) in shipping under the automatic route, simplifying investment processes. This, combined with advantages like simplified customs clearance and the presence of the GIFT City International Financial Services Centre (IFSC), creates an attractive maritime investment ecosystem.
- Global investors engagement: The summit attracted senior policymakers, industry leaders, domain experts, and global investors, including potential investors from Norway, the Middle East, Australia, and Asia. Discussions have been initiated with Norwegian and Middle East sovereign wealth funds, as well as pension funds, and there is interest from several Asia-based entities. However, explicit names of these investors have not been detailed in the reports so far.
- Scale and scope of the fund: While the fund aims to catalyze investments and reduce capital costs, the corpus noted in some sources is around INR 25,000 crore (~USD 3 billion). The MDF is expected to include ship repair and recycling components, and discussions are ongoing to increase the scope of the schemes to 10 years, as opposed to the original proposed 5 years.
- Schemes rework and extension: The government is focused on holistic reforms beyond just financing. This includes modernizing ports, adopting digital technologies, improving operational efficiencies, boosting container capacity by over 70%, and expanding cargo volumes in coastal and inland waterways. Planning involves reworking existing schemes to enhance green maritime infrastructure, shipbuilding, port infrastructure, and broader logistical integration as part of the Maritime Amrit Kaal Vision.
In summary, the MDF is a new blended finance mechanism intended to attract diversified global capital, including from Norway, Middle East, Australia, and Asia investors, although specific commitments from these regions have not been named yet. The final contours of the schemes are likely by September, and the Centre will retain control and be the anchor investor in the MDF. PE funds and sovereign wealth funds are also being considered for investment in the MDF. The Union Minister for Ports, Shipping and Waterways stated that India now offers one of the most attractive investment ecosystems in the maritime domain. The Maritime Development Fund is likely to include an interest subvention portion to the tune of ₹5000 crore, with remaining funds - nearly ₹20,000 crore - of the MDF for long-term investment purposes.
- The Maritime Development Fund (MDF), a new blended finance mechanism, aims to lower capital costs and attract investments into India's maritime sector, with a corpus of around INR 25,000 crore (~USD 3 billion), and an interest subvention portion of INR 5000 crore.
- India's maritime investment ecosystem has become more attractive due to the 100% Foreign Direct Investment (FDI) allowed under the automatic route, simplified customs clearance procedures, and the presence of the GIFT City International Financial Services Centre (IFSC).
- The MDF, announced at the Maritime Financing Summit 2025, also includes ship repair and recycling components, and discussions are ongoing to increase the scope of the schemes to 10 years, from the original 5 years.
- The aim of the MDF is to strengthen domestic shipyards, enhance their global competitiveness, and align with India’s Maritime Amrit Kaal Vision (MAKV) 2047, which seeks to position India as a leading global maritime power by focusing on shipbuilding, port infrastructure, and financial resilience.
- The Indian government is also focusing on holistic reforms, including modernizing ports, adopting digital technologies, improving operational efficiencies, boosting container capacity by over 70%, and expanding cargo volumes in coastal and inland waterways.
- The Centre will retain control and be the anchor investor in the MDF, with PE funds, sovereign wealth funds, and other investors such as those from Norway, the Middle East, Australia, and Asia being considered for potential investment.
