Cabinet’s Rs. 69,725 Crore Maritime Package: Repeated Pattern of Elite Capture

Corporate Welfare Disguised as National Development

Maritime News India : India’s latest maritime funding announcement represents another chapter in the government’s systematic exclusion of small operators while channeling public resources to established corporate giants. The ₹69,725 crore package approved on September 24, 2025, continues the familiar pattern of mega-project obsession that has characterized Indian industrial policy – where public money flows upward to large corporations while grassroots maritime enterprises remain systematically marginalized.pib

This package arrives against the backdrop of previous funding failures. The existing Shipbuilding Financial Assistance Scheme (SBFAS) has seen only 12.5% utilization of its ₹4,000 crore corpus over nine years, primarily because small shipyards lack the infrastructure and technical capabilities required to access these funds. Yet instead of addressing structural barriers, the government has tripled down on the same exclusionary model that benefits established players.infra.economictimes.indiatimes

The four-pillar approach – with its focus on mega shipbuilding clusters, Maritime Development Fund, and large-scale infrastructure – explicitly favors entities capable of handling massive capital requirements and complex bureaucratic procedures. This design inherently excludes thousands of small shipbuilding, repair, and breaking companies that form the backbone of India’s maritime industrial ecosystem.

The 20 Corporate Beneficiaries: Concentrated Wealth Distribution

Defense Shipbuilding Giants

Mazagon Dock Shipbuilders Limited (MDSL) emerges as the primary beneficiary with its ₹1,19,929 crore market capitalization and 51% acquisition of Colombo Dockyard for ₹450 crore. The company’s order book of ₹22,604 crore positions it to capture the largest share of defense-related funding from the new package.wikipedia+2

Cochin Shipyard Limited (CSL) with ₹51,185 crore market capitalization and recent ₹9,805 crore contract for Next Generation Missile Vessels represents another major beneficiary. The company’s acquisition of Tebma Shipyards’ Udupi facility for ₹60 crore demonstrates how large players acquire distressed smaller assets while accessing government funding.sharescart+2

Garden Reach Shipbuilders & Engineers Limited (GRSE) with ₹31,868 crore market cap and strategic partnerships with companies like Swan Defence and Heavy Industries Limited ( formerly known as Reliance Naval and Engineering Limited, Reliance Defence & Engineering Limited and prior to that as Pipavav Shipyard Limited and Pipavav Defence & Offshore Engineering Company Limited ) and Merlinhawk Aerospace will benefit from both defense contracts and the new funding structure designed for collaborative manufacturing.linkedin+2

Private Sector Giants

Larsen & Toubro Shipbuilding stands to gain significantly with its ₹1,000 crore expansion at Kattupalli and approved capacity of 50,000 tonnes annually. The company’s exclusion from the ₹70,000 crore P-75I submarine project due to non-compliance demonstrates how even large players manipulate tender processes while smaller operators remain excluded entirely.deccanchronicle+2

Reliance Industries Limited has strategically entered maritime infrastructure through Nauyaan Shipyard acquisition, positioning itself to benefit from shipyard development schemes while using facilities primarily for petrochemical operations rather than actual shipbuilding.infra.economictimes.indiatimes

Adani Group, with its historical interest in shipbuilding and current port operations dominance, stands positioned to benefit from Maritime Development Fund allocations and mega shipbuilding cluster development.ndtv

Consolidated Corporate Network

Bharati Defence and Infrastructure Limited (formerly Bharati Shipyard), despite bankruptcy and liquidation, has seen its assets acquired by established players – Chowgule Company purchased the Mangalore yard for ₹75 crore while Cochin Shipyard acquired the Udipi facility. These acquisitions demonstrate how the funding package will primarily consolidate existing corporate control rather than create new opportunities.infra.economictimes.indiatimes+2

ABG Shipyard Limited, despite ₹22,000 crore fraud and bankruptcy proceedings, highlights how the maritime sector’s corporate concentration continues through asset transfers to entities like Welspun Corp and Reliance Industries.wikipedia+1

Tata Steel Limited benefits indirectly through its ₹27,000 crore Kalinganagar expansion targeting shipbuilding sector steel supply, while Goa Shipyard Limited, Hindustan Shipyard Limited, and smaller players like Chowgule & Company will receive token allocations to maintain the appearance of inclusive development.indiainfoline

Systematic Marginalization of Small Operators

Ship Repair and Breaking Industry Exclusion

Alang-Sosiya ship-breaking yards, employing over 50,000 migrant workers primarily from Uttar Pradesh, Jharkhand, Bihar, and Odisha, receive no specific allocation despite being the world’s largest ship-breaking facility. These operations, handling 33% of global ship recycling, face increased plot charges (₹700 per square meter, double the previous rates) while receiving no infrastructure support.timesofindia.indiatimes+3

The Gujarat Maritime Board’s increased charges affect 183 operational plots operated primarily by small entrepreneurs who lack the resources to access the new Shipbreaking Credit Note scheme requiring complex documentation and integration with new shipbuilding projects. The ₹4,001 crore allocation for shipbreaking credits will primarily benefit large shipbuilders who can navigate the bureaucratic requirements.timesofindia.indiatimes+1

Small Shipyard Systematic Barriers

The existing 45 registered shipyards under SBFAS include numerous small operators like AC Roy Shipbuilders (23 vessels), Mandovi Drydocks (42 vessels), Chowgule & Company (14 vessels), and Shoft Shipyard (26 vessels). However, the new package’s focus on mega clusters and 4.5 million Gross Tonnage capacity requires scale and infrastructure that these operators fundamentally lack.infra.economictimes.indiatimes+1

Small ship repair facilities across India’s 7,516 km coastline operate without access to long-term financing or technology transfer programs. The Maritime Development Fund’s requirement for 49% government participation necessitates private sector matching funds that small operators cannot arrange, effectively excluding them from the funding ecosystem.pib

Regional and Social Exclusion

Dalit workers constitute a significant portion of Alang’s workforce but remain systematically excluded from skill development programs or formal employment benefits. The new package’s emphasis on technical capabilities and skilling provides no specific provisions for marginalized communities despite their central role in maritime operations.ihrb-org.svdcdn+1

Coastal communities in states like Tamil Nadu, Kerala, Andhra Pradesh, and West Bengal operate thousands of small boat-building and repair enterprises that employ traditional artisans and local fishing communities. These operations receive no recognition in the mega cluster approach, which concentrates resources in four major locations (Gujarat, Maharashtra, Odisha, Andhra Pradesh).economictimes

ESG Analysis: Environmental and Social Injustice

Environmental Impact Concentration

The mega shipbuilding cluster approach will concentrate environmental damage in four locations while providing no environmental remediation for existing polluted areas like Alang. The ₹19,989 crore Shipbuilding Development Scheme includes no mandatory environmental impact assessments or pollution control requirements for recipient companies.pib

Alang’s environmental degradation – described as “one of India’s most toxic and polluted coastlines” – receives no remediation funding despite contributing significantly to global ship recycling. The environmental costs remain socialized among local communities while profits flow to large corporations.ihrb-org.svdcdn

Social Governance Failures

The 30 lakh jobs promised by the package will primarily benefit urban, educated workforce in mega cluster locations while displacing traditional maritime workers. The absence of social impact assessments or community consultation requirements ensures that existing maritime communities have no voice in how public funds are utilized.pib

Women’s participation in maritime industries remains systematically unaddressed despite government rhetoric about inclusive development. The package provides no gender-specific allocations or women’s skill development programs in maritime sectors.

Governance and Transparency Concerns

The National Shipbuilding Mission established to oversee implementation includes no independent monitoring mechanisms or civil society representation. The global bidding process for mega clusters will likely favor international corporations with Indian corporate partnerships, further concentrating control among established players.economictimes+1

Global Case Studies of Inclusive Maritime Development

South Korea’s Distributed Development Model

South Korea’s shipbuilding success involved systematic support for small and medium shipyards alongside large conglomerates. Their Regional Maritime Development Programs ensured technology transfer to smaller operators rather than concentrating resources in mega clusters.

Hyundai Heavy Industries and Samsung Heavy Industries grew through partnerships with smaller specialized yards rather than displacing them. This approach created a comprehensive ecosystem where small operators provided specialized components and niche services while large yards handled final assembly.

China’s Inclusive Industrial Policy

Despite criticism of Chinese subsidies, their maritime development included explicit support for Township and Village Enterprises (TVEs) in shipbuilding. Small coastal shipyards received dedicated financing streams and technology access programs that prevented complete corporate concentration.

Chinese Maritime Development Funds included tiered participation requirements allowing smaller operators to access funding through cooperative arrangements rather than requiring direct private sector matching funds.

Norway’s Sustainable Transition

Norway’s maritime transformation included comprehensive worker transition programs and environmental remediation requirements for all funding recipients. Their Blue Economy Development Fund mandated social impact assessments and community benefit requirements for large maritime investments.

Norwegian shipyards like Kongsberg Maritime developed technology-sharing agreements with smaller operators rather than monopolizing advanced capabilities. This approach maintained regional employment while achieving technological advancement.

Brazil’s Regional Maritime Development

Brazil’s shipbuilding revival included explicit requirements for large companies to subcontract with local operators and provide technology transfer. Their Merchant Marine Fund included dedicated allocations for small and medium enterprises with simplified application procedures.

Government Policy Reforms for Genuine Inclusion

Immediate Structural Changes

Mandate Subcontracting Requirements: Require all mega cluster operators to subcontract minimum 30% of work to registered small shipyards with transparent payment terms and technology sharing agreements.

Create Small Operator Financing Stream: Establish ₹10,000 crore dedicated fund for enterprises with less than 500 employees with simplified application procedures, no matching fund requirements, and technical assistance programs.

Implement Geographic Distribution Mandates: Require equal allocation across all coastal states rather than concentrating resources in four mega clusters, ensuring regional maritime development and preventing displacement of existing operators.

Establish Worker Transition Programs: Create comprehensive retraining and social security programs for workers in traditional shipyards affected by industry consolidation.

Long-term Systemic Reforms

Democratic Governance Structure: Establish Maritime Development Council with equal representation from small operators, worker unions, coastal communities, and environmental groups alongside corporate representatives.

Technology Democratization: Mandate open-source technology sharing for all government-funded research and require large recipients to provide technical training to small operators.

Environmental Justice Integration: Require comprehensive environmental remediation in existing polluted areas like Alang before approving new mega projects, ensuring environmental costs are not socialized while profits remain private.

Social Impact Assessment Requirements: Mandate independent social impact assessments for all funding allocations above ₹100 crore with community veto powers over projects affecting traditional maritime livelihoods.

Way Forward: Beyond Corporate Welfare

Accountability and Measurement Framework

The government must establish quantitative inclusion metrics including percentage of funds reaching enterprises with less than 500 employees, geographic distribution of benefits, and impact on traditional maritime communities. Quarterly public reporting should detail actual beneficiaries rather than aggregate investment figures.

Independent monitoring committees with civil society representation must track implementation outcomes and have authority to recommend funding reallocation when inclusion targets are not met.

Alternative Development Models

Rather than mega cluster concentration, India should adopt a distributed development approach with maritime industrial parks in every coastal district, scaled appropriately for regional capabilities and existing operator networks.

Cooperative development models could enable small operators to pool resources for technology acquisition and market access while maintaining independent operations and local employment.

Financial Architecture Reform

The Maritime Development Fund should be restructured with tiered participation requirements: 70% allocation for enterprises below ₹100 crore turnover, 20% for medium enterprises, and 10% for large corporations. This reverses the current structure that concentrates benefits among established players.

Regional Development Banks should be mandated to provide maritime financing with government guarantees for small operators, removing the private sector matching requirements that systematically exclude smaller enterprises.

The ₹69,725 crore maritime package represents a critical juncture for India’s maritime future. The government can choose to continue the pattern of corporate welfare that has characterized previous initiatives, or demonstrate genuine commitment to inclusive maritime development that strengthens India’s entire maritime ecosystem rather than just enriching established corporations.

Without fundamental restructuring, this package will join the long list of government initiatives that promise national development but deliver primarily corporate concentration and regional inequality. The maritime sector’s true transformation requires democratizing access to capital, technology, and markets rather than concentrating resources among entities that are already well-positioned to capture government largesse.

The choice between maritime democracy and maritime oligarchy remains open, but current trends suggest the government is prioritizing efficiency over equity, scale over inclusion, and corporate convenience over community empowerment. Reversing this trajectory requires immediate policy intervention and a fundamental rethinking of what maritime development should achieve in a democratic society that claims to pursue inclusive growth while systematically excluding those who need support most.