New Delhi: India is set to introduce ₹40,000 crore ($454 million) in incentives to strengthen its shipbreaking industry and reclaim market share from Bangladesh and Pakistan, according to sources familiar with the plan. The benefits, likely to be approved by the Cabinet by the end of September, will be spread over ten years starting 2026.
Ship owners bringing obsolete vessels to India will receive credit notes worth roughly 40% of the scrap value, valid for three years and usable to purchase Indian-built ships. The notes can be combined or sold, adding flexibility for stakeholders.
India currently handles about one-third of the world’s ship recycling market, trailing Bangladesh’s 46% share. Most dismantling occurs at Alang on the western coast, though neighboring Bangladesh and Pakistan have been gradually eroding India’s dominance.
Rising freight rates and extended lifespans for oil tankers following geopolitical disruptions, including the Russia-Ukraine war, have revived business in recent months. Additionally, India is exploring a shipbreaking facility on its eastern coast to attract business from Bangladesh.
The government is also poised to approve a ₹25,000 crore maritime development fund to boost domestic shipbuilding and reduce reliance on foreign-built vessels, part of broader efforts to strengthen the country’s maritime sector.
