VPA partners with AP Govt. for shipbuilding SPV

The Visakhapatnam Port Authority (VPA) has partnered with the Andhra Pradesh government to set up a Special Purpose Vehicle (SPV) for developing a major shipbuilding cluster at Dugarajapatnam in Tirupati district.

According to a press note issued by the VPA, the State government has approved the incorporation of Ship Building and Heavy Industries Park Andhra Pradesh Limited (NSIHP-AP Ltd.) as a Special Purpose Vehicle (SPV) for the development of a world-class shipbuilding, ship-repair, and allied maritime industrial infrastructure at Dugarajapatnam.

The initiative marks a major boost to Andhra Pradesh’s maritime sector and is expected to position the State as a leading hub for shipbuilding and heavy industries in the country, generating substantial employment opportunities and accelerating industrial growth.

The project will be implemented through a 50:50 Special Purpose Vehicle (SPV) between the Andhra Pradesh Maritime Board and the Visakhapatnam Port Authority. The initiative falls under the Shipbuilding Financial Assistance Policy (SBFA) Scheme of the Government of India, and the selection of a strategic shipyard partner to develop the cluster will be undertaken in accordance with the scheme guidelines.

The Dugarajapatnam Shipbuilding Cluster will play a pivotal role in strengthening India’s shipbuilding and ship-repair ecosystem. It will catalyse the development of ancillary industries, generate large-scale direct and indirect employment, and promote coastal industrialisation in southern India.

For Andhra Pradesh, the project will firmly position the State as a key maritime manufacturing hub, complementing its port-led development strategy. With an estimated investment of Rs. 29,662 crore, the Dugarajapatnam Shipbuilding and Repair Cluster is poised to significantly contribute to the State’s Gross State Domestic Product (GSDP). Spread across 2,000 acres in Nellore district and leveraging Andhra Pradesh’s 974-km-long coastline, the project aims at reducing import dependence and attracting substantial domestic and global investments.

The integrated maritime hub will feature four dry docks, ship-lift facilities, and state-of-the-art supporting infrastructure, establishing Andhra Pradesh as a premier shipbuilding destination. The project envisages creating a shipbuilding capacity of 1.2 million Gross Tonnage Per Annum (GTPA) and will serve as a major centre for shipbuilding, ship repair, and marine fabrication, further strengthening India’s Make in India initiative. The facility will also reduce logistics costs for regional industries, thereby enhancing manufacturing competitiveness, trade efficiency, and export potential.

Additionally, the project is expected to attract ancillary investments ranging between Rs.8,000 crore and Rs. 10,000 crore from ship component manufacturers, marine equipment suppliers, and logistics service providers, further amplifying its economic impact.

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This article is written by Senior Journalist Lakkoju Nagesh Babu