Andhra Pradesh unveils mega push for shipbuilding

Andhra Pradesh is charting an ambitious new course to establish itself as a maritime powerhouse, unveiling a comprehensive shipbuilding and allied industries policy while simultaneously attracting major private investments in advanced manufacturing. The twin announcements, made in the State Assembly on Thursday, highlight the government’s focus on building a diversified industrial ecosystem capable of generating large-scale employment and driving sustainable growth.

Maritime policy to spur shipbuilding

Replying to questions from legislators Nadukuditi Eswara Rao and Kamineni Srinivas, State Investments and Infrastructure Minister B.C. Janardhan Reddy revealed that the government has rolled out the Andhra Pradesh Maritime Policy, a first-of-its-kind initiative designed to transform the state into a hub for shipbuilding, ship repair, and shipbreaking.

The policy includes a wide range of fiscal incentives and subsidies aimed at attracting both domestic and global shipbuilding majors. Investors will be eligible for up to 25% capital subsidy on their projects, along with 10-year reimbursements of State Goods and Services Tax (SGST). To encourage early adoption, the first five ships built in the state will also attract an additional 20% SGST reimbursement.

The incentives go further, offering production-linked subsidies covering up to 25% of costs, exemptions on stamp duty and electricity duty, as well as subsidies on utilities. Investors will also benefit from long-term land leases facilitated by the Andhra Pradesh Maritime Board and a single-window clearance mechanism, which the government says will significantly cut down on bureaucratic delays.

Push for green technologies

A key highlight of the policy is its focus on innovation and sustainability. To promote environmentally responsible shipbuilding practices, the state will provide 75% reimbursement for feasibility study costs and 100% reimbursement for the adoption of eco-friendly ship technologies. Officials said this measure will not only reduce the industry’s carbon footprint but also position Andhra Pradesh as a global leader in green shipbuilding solutions.

National-level backing at Dugarajapatnam

Parallel to the state government’s efforts, the Union Ministry of Ports, Shipping and Waterways is advancing plans to establish a shipbuilding cluster at Dugarajapatnam in Tirupati district. The project is being developed under a Special Purpose Vehicle (SPV) model, with modalities currently being finalized between the Centre and the Andhra Pradesh government.

Once operational, the cluster is expected to act as a magnet for heavy maritime industries, ship component suppliers, and logistics companies. According to initial estimates, the cluster could generate close to 1.48 lakh direct and indirect jobs in the state, making it one of the largest industrial employment generators in recent years.

Andhra Pradesh as a maritime hub

Minister Janardhan Reddy emphasized that the shipbuilding policy marks a turning point in the state’s industrial strategy. “Andhra Pradesh has a long coastline, strong port infrastructure, and a skilled workforce. With the right incentives and Centre–State coordination, we are confident of becoming a global hub for shipbuilding and allied activities,” he said.

The government is also banking on its robust connectivity through major ports like Visakhapatnam, Krishnapatnam, and Gangavaram to create an integrated maritime ecosystem. This will allow seamless export of ships and marine equipment while also supporting domestic shipping lines.

Garuda Aerospace’s ₹250 crore drone investment

Adding further momentum to the state’s industrial growth, Chennai-based Garuda Aerospace has announced plans to invest ₹250 crore in setting up a large-scale drone manufacturing facility in Andhra Pradesh.

Company representative Shyam Kumar met Minister Janardhan Reddy at the Secretariat to present the proposal. The plant is expected to produce next-generation drones for applications in agriculture, logistics, surveillance, and disaster management. With drone technology becoming a critical enabler for multiple industries, the facility is likely to generate significant employment opportunities for engineers, technicians, and skilled workers in the state.

Welcoming the investment, the minister noted that Andhra Pradesh is emerging as a preferred investment destination owing to its proactive policies, infrastructure readiness, and business-friendly governance. “Ventures like Garuda Aerospace will not only boost industrial diversification but also open up livelihood opportunities for our youth in cutting-edge technology sectors,” he said.

Building a future-ready economy

Observers note that the combination of heavy industries like shipbuilding and high-tech manufacturing like drones reflects Andhra Pradesh’s strategy of balancing traditional industrial strengths with futuristic technologies. By positioning itself at the intersection of maritime trade and advanced manufacturing, the state hopes to attract a diverse set of investors while creating employment across skill levels.

With the shipbuilding cluster at Dugarajapatnam set to anchor large-scale industrial growth, and companies like Garuda Aerospace committing substantial private capital, Andhra Pradesh appears poised to fast-track its journey towards becoming both a maritime and innovation hub in India.