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The Union Budget announced an Export Promotion Mission with an outlay of ₹2,250 crore to facilitate easy access to export credit, cross-border factoring support, and help MSMEs tackle non-tariff measures in overseas markets.

The Mission, with sectoral and ministerial targets, will be driven jointly by the Ministries of Commerce, MSMEs, and Finance.

This is among the slew of measures announced in the Budget to promote exports.

Another major plan is to create a digital public infrastructure, ‘BharatTradeNet’ (BTN), for international trade and it will be an unified platform for trade documentation and financing solutions. This will complement the Unified Logistics Interface Platform. The government will also revamp the model BIT (Bilateral Investment Treaty) to make it more investor-friendly and encourage sustained foreign investment.

Institute in Bihar

In order to support food processing exports, a National Food Technology Institute will be set up in Bihar and it will enhance value addition, agri-exports, and job creation.

The duration for export of handicrafts manufactured from duty free inputs by bona fide exporters will be extended to one year, further extendable by 3 months.

A release from the Department of Commerce says India’s trade deficit in maritime services is about $50 billion and development of Indian shipping lines is likely to address this trade deficit. Shipbuilding financial assistance policy will be revamped, including credit notes for ship-breaking to support a circular economy. The Maritime Development Fund of ₹25,000 crore will be used to finance long-term industry growth, with 49% government contribution. Large ships above a specific size will be added to the infrastructure harmonized master list (HML).

Facilitation groups

In a move to integrate with global supply chains, the government will support development of domestic manufacturing capacities. The sectors will be identified based on objective criteria. Facilitation groups with participation of senior officers and industry representatives will be formed for select products and supply chains. Through this, there are huge opportunities related to Industry 4.0, which needs high skills and talent. The government will support the domestic electronic equipment industry to leverage this opportunity for the benefit of the youth.

Export growth requires infrastructure development, and the Budget says the government will facilitate upgradation of infrastructure and warehousing for air cargo, including high value perishable horticulture produce. Cargo screening and customs protocols will be streamlined and made user-friendly.

In the services sector, the government will support growth of tourism and financial services.

A national framework will be formulated to promote Global Capability Centres (GCCs) in tier-two cities, focusing on talent, infrastructure, and regulatory reforms. A new transfer pricing scheme will determine arm’s length pricing for three years, aligning with global best practices.

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The Union Budget presented by Finance Minister Nirmala Sitharaman on Saturday (February 1, 2025) made some significant proposals for promoting indigenous ship building as also acquisition of Indian-flagged ships. Among them, the Budget has proposed the setting up of a Maritime Development Fund (MDF) to support India’s maritime sector by providing financial assistance, via equity or debt securities, which will directly benefit in financing for ship acquisition and aims at boosting Indian-flagged ships’ share in the global cargo volume up to 20% by 2047.

“The initial corpus of the fund is pegged at ₹25,000 crore — where the government contribution will be 49%. The remaining balance will be contributed by major port authorities, other government entities, Central public sector enterprises, financial institutions as well as private sector. This fund will directly benefit in financing for ship acquisition,” the Union Ministry of Ports, Shipping and Waterways said in a statement. “Further, indigenous fleet will reduce dependability of foreign ships, improve balance of payment and secure strategic interests of the country. By 2030, the MDF is aiming at generating up to ₹1.5 lakh crore investment in the shipping sector.”

Also read | Govt to bring framework to unlock potential marine sector with focus on Andaman and Lakshadweep: FM Sitharaman

New clusters

Stating that the budgetary initiatives for India’s marine sector are focused on unlocking its vast potential and enhancing existing assets through upgrades, modernisation, and automation, Minister Sarbananda Sonowal said, “A key highlight is our Ministry’s development of new shipbuilding clusters of 1.0 to 1.2 Million Gross Tonnage (GT) each. This strategic push is crucial in realising India’s vision of becoming a $30 trillion economy by 2047.”

These efforts will enhance India’s global competitiveness, drive sustainable growth, and solidify its position as a leading global maritime hub.

“Considering that shipbuilding has a long gestation period, I propose to continue the exemption of Basic Customs Duty on raw materials, components, consumables or parts for the manufacture of ships for another 10 years,” Ms. Sitharaman said in her budget speech. “I also propose the same dispensation for ship breaking to make it more competitive.”

The scheme for mega shipbuilding clusters will provide direct capital support in the form of creating the breakwater along with capital dredging and also proposes a 10-year rent holiday for the land, if not provided at a nominal rate, the Ministry said in a statement. Investment is also designed to support creation of trunk infra like roads, utilities, sewage treatment among others. “The proposed allocation of ₹6,100 crore aims to support India’s existing shipyards in upgrading, modernising, and automating their operations, enhancing efficiency, utilisation, and overall output.”

The Budget has also extended the Shipbuilding Financial Assistance Policy 2.0, aimed at providing direct financial subsidies to Indian shipyards. This initiative seeks to help in securing orders by offsetting operational cost disadvantages, thereby strengthening the domestic shipbuilding industry. To be financed via budgetary support, the total outlay of the scheme is ₹18,090 crore, the statement added. The Budget also has an allocation of ₹6,100 crores to upgrade, modernise and automate Indian ports operations to upscale efficiency.

In addition, Ms. Sitharaman noted that presently the tonnage tax scheme is available to only sea going ships and added that the benefits of existing tonnage tax scheme are proposed to be extended to inland vessels registered under the Indian Vessels Act, 2021 to promote inland water transport in the country.