The Union Cabinet is likely to soon approve a Rs 25,000-crore Maritime Development Fund (MDF) for the shipping sector, sources said. The Ministry of Shipping has sent the final proposal for Cabinet approval.

Earlier, during the Union Budget speech on February 1, 2025, Finance Minister Nirmala Sitharaman had announced the setting up of the MDF to boost India’s maritime sector. Following the budget announcement, detailed deliberations were held within the Ministry of Shipping and with industry stakeholders. Based on these discussions, the final proposal — outlining the modalities for fund usage — was cleared by the Expenditure Finance Committee (EFC), chaired by the Expenditure Secretary, and has now been forwarded to the Cabinet.

According to the proposal, the fund will provide financial assistance to the shipping sector through equity and debt securities. The initial corpus is pegged at Rs 25,000 crore, with the government contributing 49%. The remaining balance will be mobilised from major port authorities, other government entities, Central PSUs, financial institutions, and the private sector.

The MDF aims to finance ship acquisitions and significantly boost the share of Indian-flagged ships in global cargo to 20% by 2047. An increased indigenous fleet is expected to reduce dependence on foreign vessels, improve the Balance of Payments, and secure India’s strategic maritime interests. By 2030, the MDF targets to generate investments worth up to Rs 1.5 lakh crore in the shipping sector.

Source: Moneycontrol

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