India Launches Two New Credit Risk Insurance Policies for Shipbuilding

On Tuesday, India’s Shipping Ministry revealed two pioneering credit risk insurance schemes designed to bolster the country’s shipbuilding industry as part of the National Shipbuilding Mission. These insurance products aim to offer financial protection to shipyards engaged in both export and domestic projects, reducing the risks associated with delayed payments and project uncertainties.

The first product, called the Shipbuilding Project Credit Risk Insurance Policy (SbPCP), has been developed by ECGC Ltd. This policy specifically targets export-oriented shipbuilding ventures, providing coverage against credit risks tied to international contracts. Meanwhile, The New India Assurance Co Ltd created the Business Credit Shield Policy Shipbuilders (BCSPS), which focuses on safeguarding domestic shipbuilding projects.

Union Minister for Ports, Shipping and Waterways Sarbananda Sonowal announced these measures during the concluding session of the 21st Maritime State Development Council (MSDC) meeting, held recently. He emphasized that the central government would subsidize insurance premiums for shipyards and provide direct financial backing to insurers if claims are made. The intention behind this support is to ease financial pressures on shipyards undertaking large-scale vessel manufacturing, an industry segment known for its extended timelines and complex payment structures.

Sonowal highlighted the challenges faced by shipbuilders, noting that constructing a ship is a lengthy process extending over several years. Any missed payment milestone can jeopardize the entire operation of a shipyard. "With these new insurance policies, we are stepping in to give them a real safety net. We want our shipyards to focus on what they do best, building world-class vessels, without the fear of delayed payments or sudden global market shifts holding them back," he said.

These policies are introduced under the Shipbuilding Development Scheme (SbDS), reflecting the government’s commitment to strengthening the shipbuilding sector, which plays a key role in supporting maritime trade, defense, and economic growth. The sector’s growth aligns with broader national objectives of enhancing maritime infrastructure and self-reliance in ship production.

The announcement coincided with the first meeting of the Maritime State Development Council (MSDC) following its designation as a statutory consultative body under the Indian Ports Act, 2025. Notified on May 15, 2025, this new status expands the Council’s responsibilities, enabling it to facilitate integrated maritime growth and coordinated policy-making across states and the central government.

During the meeting, the MSDC reiterated support for the National Perspective Plan, urging states to accelerate the development of multimodal connectivity projects. These include enhancements in road, rail, inland waterways, pipelines, and conveyor systems to improve access to ports and industrial clusters. The Council also called on states to collaborate with the Ministry of Ports, Shipping and Waterways (MoPSW) in establishing port-linked industrial zones featuring ready land, plug-and-play infrastructure, and streamlined approvals. Such initiatives are designed to complement port expansion and connectivity upgrades, fostering port-led industrialization.

In addition to the insurance scheme announcements, Minister Sonowal unveiled the Ready Reckoner for Implementing One Nation One Port (ONOP). This comprehensive guide aims to assist major and other ports in aligning with central government circulars from the Central Board of Indirect Taxes and Customs, Ministry of Home Affairs, and Ministry of Health and Family Welfare. It outlines expectations for state and Union Territory authorities to expedite ONOP’s execution, which seeks to unify and simplify port operations nationwide.

Sonowal described the MSDC’s new statutory status as a milestone that deepens cooperative federalism within maritime governance. He noted the adoption of the Maritime India Vision 2030 and Maritime Agenda 2047 as strategic frameworks that will prepare India’s ports and shipping sector for future challenges, ensuring competitiveness on the global stage. The resolutions passed at the Council’s session mark a significant step toward fostering integrated maritime development and supporting the nation’s ambitions for port-centered industrial growth.

India’s move to introduce these specialized insurance products reflects a broader trend in the global maritime industry where financial risk management is becoming increasingly important. Shipbuilding involves considerable capital investment and long lead times, making credit protection essential for maintaining steady operations and encouraging investment. These insurance policies could serve as models for other emerging maritime nations looking to strengthen their shipbuilding capabilities.