Mazagon Dock Shipbuilders (MDL) is sounding out potential partners for proposed shipbuilding clusters at Dighi in Maharashtra and Dugarajapatnam in Andhra Pradesh, as it prepares to move beyond defence work and expand into commercial shipbuilding. The state-run company expects the projects to require an investment of about ₹20,000 crore over five to seven years, its chairman and managing director, Captain (retired) Jagmohan, told media.
MDL has signed memoranda of understanding with the two state governments, with proposed investments valued at ₹30,000 crore across the agreements. The company’s planned investment is distinct from the larger headline figure: the projects are expected to be developed in phases, with the first phase providing 500,000 gross tonnage (GT) of annual capacity. Each cluster is envisaged to eventually support output of 1.2 million GT a year.
The financing plan combines public-sector participation with debt and private capital. MDL intends to form a joint venture with the Maritime Investment Fund (MIF), managed by SBI Ventures, with each holding a 50 per cent stake initially, Jagmohan said. The wider investment is expected to be financed with 70 per cent debt and 30 per cent equity; across both clusters, the estimated equity requirement is about ₹6,500 crore.
The search for partners is not limited to financial investors. MDL is in discussions with large companies that rely on ships for trade and business, as well as international maritime equipment manufacturers. Investors from the United States and Germany have also expressed interest, according to Jagmohan. The company is considering a commercial model in which ship users become equity partners, while two dedicated project companies would keep each cluster’s finances and operations separate. MDL says it will not reduce its stake below 26 per cent.
The government’s maritime financing programme provides a potential source of support, though the proposed projects still require approvals and detailed funding arrangements. In September 2025, the Union Cabinet approved a ₹69,725-crore package to strengthen shipbuilding and the wider maritime sector. It includes a ₹25,000-crore Maritime Development Fund, split between a ₹20,000-crore Maritime Investment Fund and a ₹5,000-crore Interest Incentivisation Fund, alongside a separate Shipbuilding Development Scheme with an outlay of ₹19,989 crore.
MDL’s partnership strategy reflects the scale and long lead times involved in building shipyards. The company says it can fund its own share of the equity, but most of the project financing is expected to come from debt. Securing lenders and bringing ship users and equipment suppliers into the ventures will therefore be important before the plans can translate into construction and operating capacity.
The proposals also fit the government’s ambition to raise India’s annual shipbuilding capacity to 4.5 million GT and make the country one of the world’s leading shipbuilding nations by 2047. The Cabinet’s 2025 package is intended to support new clusters, existing shipyard expansion, financing, technology and workforce development.
For MDL, the projects would mark a significant extension of its role beyond its established defence business. But the announcements remain plans, not completed shipyard investments: approvals, partner selection, capital commitments and staged execution will determine when the proposed facilities can begin building vessels. The company is also considering a possible public offering of the shipbuilding venture after a yard becomes operational, Jagmohan said.
