The Union Budget 2025-2026 marks a significant push toward modernizing India's ocean freight logistics sector. With a strong emphasis on infrastructure development, digital transformation, and sustainability, the budget introduces targeted measures to enhance efficiency, reduce costs, and promote India as a global maritime hub. The strategic initiatives outlined aim to boost shipbuilding, improve port connectivity, and encourage green shipping practices, ultimately driving economic growth and strengthening India's position in international trade. Below are the key highlights and their implications for the industry.
Initiative | Details |
Maritime Development Fund |
Establishment of a ₹25,000 crore fund to support the shipbuilding and repair industry, with up to 49% government contribution and the remainder from ports and private sector investments. |
New Shipping Company |
Formation of a new shipping company in collaboration with oil refiners and the Shipping Corporation of India to expand the national fleet and reduce reliance on foreign carriers. |
Shipbuilding Clusters and Tax Incentives |
Promotion of shipbuilding clusters and extension of a 10-year import tax exemption on inputs for shipbuilding and shipbreaking activities. Issuance of credit notes for shipbreaking to encourage the scrapping of old vessels and construction of new ones. |
Port Connectivity Enhancements |
Implementation of economic railway corridors and port connectivity corridors under the PM Gati Shakti Programme to improve logistics efficiency and reduce costs. |
These initiatives are designed to enhance infrastructure, support industry growth, and improve overall efficiency in India's maritime sector.
A major announcement in the budget is the establishment of a Maritime Development Fund with an initial allocation of ₹25,000 crore ($2.9 billion).
Component |
Funding Source |
Government Contribution |
49% of the fund |
Ports & Private Sector |
51% of the fund |
The government plans to set up a new shipping company in collaboration with oil refiners and the Shipping Corporation of India.
To boost India's shipbuilding industry, the government will:
A key focus area is improving connectivity to ports through the PM Gati Shakti Programme, aimed at streamlining logistics operations.
The budget promotes coastal shipping as an energy-efficient and cost-effective mode of transport.
The budget has also addressed the need for sustainable maritime practices, including:
The government aims to enhance efficiency through technology-driven solutions.
The Economic Survey 2025-26 has provided crucial insights into India’s macroeconomic trends and their impact on ocean freight logistics:
The Union Budget 2025-26 has introduced several forward-thinking initiatives to strengthen India's ocean freight logistics sector. The establishment of a Maritime Development Fund, investments in port connectivity, incentives for green shipping, and advancements in digital logistics are expected to enhance efficiency and reduce costs. These measures align with India's goal of becoming a global maritime hub, promoting sustainable and technology-driven growth in the shipping industry.
Sources: PIB govt, Economic times, Live mint, Baird maritime