The Strait of Hormuz crisis has shown the world how fragile the sea lanes are. India has long relied on other countries’ ships and foreign hubs, and it is now trying to change that by building its own ships and harbours. The plan has four parts: shipyards, mega-ports, a funded river lifeline in Kolkata, and trade rules that keep exports moving.
The gap India wants to close
Shipbuilding is the starting point, and the gap is large. China, South Korea and Japan together hold about 95% of the global shipbuilding market, while India’s share is estimated at only about 0.06%. That is despite maritime transport carrying nearly 95% of India’s trade by volume and about 70% by value.
The official goals are ambitious. India aims to enter the top 10 shipbuilding nations by 2030 and the top five by 2047. A nearer marker is also on the table: India plans to increase ship ownership sevenfold to 100 million GT and expand shipbuilding output 40 times to around 4.5 million GT by 2037.
Pillar 1: Shipbuilding is getting real money and real partners
The policy backbone is a ₹69,725 crore (about USD 7.34 billion) package, made up of ₹24,736 crore for the Shipbuilding Financial Assistance Scheme and ₹25,000 crore for the Maritime Development Fund, with the rest going to a shipbuilding development scheme.
Foreign and domestic capital is now following the policy:
HD Hyundai at Thoothukudi. HD Korea Shipbuilding & Offshore Engineering signed an MoU for a $4 billion greenfield shipyard on Tamil Nadu’s southern coast. Reports put the investment at ₹38,000 crore with potential for 15,000 direct jobs. The site is the most advanced of five government-designated clusters, with in-principle approval granted. The Union government is to contribute 10–12% of project cost for infrastructure, and Tamil Nadu will offer a 25% capital subsidy.
Korea as a strategic partner. Under the VOYAGES framework, India and South Korea adopted a cooperation plan in April 2026 covering shipbuilding, shipping and maritime logistics. During his Busan visit this week, Minister Sonowal said the Thoothukudi partners aim to settle a joint venture structure and finish a detailed project report within six months. He also said India and KOICA are working on a shipbuilding training centre in Kochi.
Tata’s possible entry. The Tata Group has proposed investing ₹100 billion (about $1 billion) in a Kerala shipbuilding project. This is still a proposal, and Kerala is reviewing it, with land allocation planned only if it is approved.
The caution is that money alone does not make a shipyard. The earlier 2016 subsidy policy failed to move India’s share of world shipbuilding, which stayed near zero throughout. The test now is execution: skilled labour, a steel and equipment supply chain, and finished ships delivered on time.
Pillar 2: Ports built for mega-ships
India’s ports are already running hot. Mundra and JNPA operate at about 90% capacity while handling 65% of EXIM trade. Three projects stand out:
Vizhinjam (Kerala). In its first full year it handled 1.296 million TEUs of transhipment across 607 vessels. It has since processed 1.45 million TEUs, running at 131% capacity utilisation, and construction has begun to expand it to three million TEUs. That matters strategically because Vizhinjam can berth mother vessels up to 400 metres long, which has until now pushed Indian cargo to foreign hubs. Completion of the capacity augmentation is targeted for December 2028.
Vadhvan (Maharashtra). This ₹76,220 crore greenfield port is backed by JNPA and the Maharashtra Maritime Board, and its backers say it could rank among the world’s top 10 ports. Full build-out is pegged at some 23 million TEU, with phase 1 targeted for commissioning in 2029.
JNPA (Mumbai). India’s largest container gateway handled a record 102 million tonnes and 8.17 million TEUs in FY2025–26. Its leadership sees Vadhvan as a natural extension that will take large mainline vessels JNPA cannot handle efficiently.
Tuticorin, the port serving the Thoothukudi shipyard site, is part of the same story. Logisticswall reported this week that its container terminal has gone fully electric, a sign that automation and green power are becoming standard rather than showpieces.
Pillar 3: Kolkata’s river lifeline gets funding
Not every port can be built from scratch, and some depend on a river staying navigable. On 22 October 2026 the Centre approved ₹430.68 crore of dredging assistance for Syama Prasad Mookerjee Port, against a ₹764.37 crore maintenance bill for FY2024–25 and FY2025–26. The money keeps open the 232-km channel to the Kolkata Dock System and the 125-km stretch serving Haldia.
The support comes with a deadline. From FY2026-27, central payments will depend on meeting annual targets, and they end entirely after FY2030-31. The port has spent ₹300–500 crore a year on dredging, so it will need to become self-funding within a few years. Cargo is moving the right way: 34.75 million tonnes in the first half of FY27, up about 4%. That matters for eastern India, Nepal and Bangladesh trade, and for Kolkata, where Logisticswall is based.
Pillar 4: Trade policy that keeps cargo flowing
Ports and ships only matter if cargo moves, and the Directorate General of Foreign Trade (DGFT) is adjusting rules to match. This year it has moved wheat flour and related products from prohibited to free for export, added Egypt and Jordan to the RELIEF export scheme, and tightened silver imports by restricting certain codes. The commerce minister has also said the government will bear certification costs for micro and small exporters under the Export Promotion Mission. The pattern is flexible, case-by-case policy: open where supply is strong, restrict where imports are sensitive, and support small exporters directly.
What this means for the world
Three things matter beyond India:
Supply-chain diversification. If Hormuz and the Red Sea stay risky, shippers need alternatives. Logisticswall’s coverage of Jebel Ali export disruption and shipping lines rerouting cargo shows why. A big Indian transhipment hub on the west and south coast helps absorb that shock.
A new shipbuilding competitor. Korea and Japan gain a partner and a market, and China gains a rival. India will not match the top three soon, but even a modest share of new orders would shift a very concentrated industry.
Ship supply for the energy transition. The IMO has approved the world’s first global carbon pricing for shipping. Yards that can build efficient, green-fuel ships will be better placed, and India’s subsidy scheme already targets green-vessel construction.
The road to 2047
The plan is clear on paper, but the next three years decide whether it succeeds. Watch for the Thoothukudi joint venture and project report, a Tata decision on Kerala, Vizhinjam’s 2028 capacity, and Vadhvan’s 2029 first phase. The risks are cost, skills, financing and global competition. If those milestones land on time, India will be a country that builds its own ships and handles its own cargo, not one that depends on other countries’ hubs.
Sources: figures above are drawn from recent reports by Maritime Gateway, Baird Maritime, India Sea Trade News, PIB/ORF, Korea Herald and Logisticswall. Project figures vary by outlet and may change as agreements are finalised.
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