See Full Document Text
File No. SY-19014/80/2024-SBR
Government of India
Ministry of Ports, Shipping and Waterways
(SBR Section)
3rd Floor, PTI building,
1 – Parliament Street,
New Delhi – 110001
Dated: November 4th, 2025
To,
1. CMD, Cochin Shipyard Limited (CSL)
2. CMD, Shipping Corporation of India (SCI)
3. CMD, Hindustan Shipyard Limited
4. CMD, Mazagon Dock Shipbuilder Limited
5. CMD, Goa Shipyard Limited
6. CMD, Garden Reach Shipbuilder and Engineers Limited (GRSE)
7. CMD, Swan Defence and Heavy Engineering
8. CMD, L&T Shipbuilding
9. CMD, Shoft Shipyard pvt. Ltd.
10. CMD, Chowgule and Company Pvt. Ltd.
11. CMD, Titagarh Wagon Limited
12. CMD, Chowgule Global
13. Head, ISTC
14. Directorate General of Shipping
15. Advisor, Shipyards Association of India (SAI)
16. CEO & MD, Indian Shipbuilders Association of India (ISBA)
17. CEO, Indian National Shipowenrs Association (INSA)
18. VC & CEO, Gujarat Maritime Board (GMB)
19. New India Assurance (NIA)
20. Export Credit Guarantee Corporation of India (ECGC)
21. Sagarmal Finance Corporation Limited (SMFCL)
22. Indian Register of Shipping (IRS)
23. Indian Maritime University (IMU)
24. Centre of Excellence in Maritime and Shipbuilding (CEMS)
25. Ship Recycling Industries Association (SRIA)
26. International Shipyards (HD KSOE, Hanwha Ocean, Imabari Shipyards, CMA
CGM, AP Mollar Maersk, MSC, Damen Shipyards, Royal HSC, DP World,
NYK Line Japan)
27. Container Shipping Lines Association (CSLA)
Subject: Draft Guidelines for P3 i.e., Shipbuilding Development Scheme (SbDS) for
Capacity & Capability development and credit risk coverage for shipbuilding in India.
Sir,
The undersigned is directed to say that Union Cabinet, in its meeting held on
24.09.2025, approved the Shipbuilding Development Scheme (SbDS) for Capacity
& Capability development and credit risk coverage for shipbuilding in India of this
Ministry to promote shipbuilding in India.2.
In this regard, it is stated the draft guidelines for the above scheme have
been prepared in consultation with various stakeholders. A copy of draft guidelines is
attached for perusal. NIC team is requested to upload the draft on the Ministry's
website/portal.
3.
It is requested that your opinion i comments on draft may be sent to SBR
Division in the attached proforma latest by l3th November, 2025 on the following
mail - js-shipping@gov.in, j s-ports@nic.in, dirl-psw@gov.in and .ln.
4.
DG Shipping is requested to upload the same on their seek inputs /
comments/ suggestions from public / stakeholders.
5.
Your Co-operation and early reply wilt be highly appreciated.
Yours faithfully,
(1*t
to the Govt. of India
Tel: 011-23311659Format for seeking comments on Guidelines for adopting
for
Shipping Development Scheme (SbDS) Capacity and
Capability Development and Credit Risk Coverage for
Shipbuilding in India - reg.
Organization/Agency Name:
Address with Contact details:
Type of Agency (GoWPrivate/PSU/lndividual/other):
Para wise remarks on the draft:
sl. Para No. ol Existing text in the draft Proposed Remarks
No. the Draft guidelines changes
Other Remarks (lf any):
E-mail this format to js-shipping@gov.in js-ports@nic.in, dirl-
psw@nic.in and copy to usshipping2-psw@gov.in.Committee Report on Shipbuilding Credit
Risk Coverage Guidelines under
Shipbuilding Development Scheme (SBdS)
1INDEX
Sr. No. Page Number
1 Background 3-6
2 Annexure-I : Minutes of Stakeholder 7-8
consultation meeting dated 15.10.2025
(Online)
3 Annexure-II : Minutes of meeting- core 9-15
committee with all other stakeholders-
dated 17.10.2025 (Physical/Online at
GIFT city Ahmedabad)
4 Annexure-III: Minutes of meeting – core 16-18
committee meeting dated 25.10.2025
(Online)
5 Annexure-IV: Minutes of meeting- core 19-24
committee with all other stakeholders-
dated 30.10.2025 (Physical/Online at DG
shipping office, Mumbai)
6 Annexure-V: Inputs from Stakeholders 25-27
on Capacity and Capability building
guidelines under SBdS
7 Annexure- VI: Constitution of Credit Risk 28-32
coverage Core Committee Order for
Drafting Guidelines Under SbDS
8 Annexure-VII: Draft Credit Risk coverage 33-40
Guidelines -
2Committee Report on Ship building Credit Risk coverage Guidelines under
Shipbuilding Development Scheme (SBdS)
Dated: 03-11-2025
1. Background
In pursuance of the Office Memorandum No. SY-13017/III/2025-SBR dated 9th
October 2025 issued by the Ministry of Ports, Shipping and Waterways (MoPSW), the
Directorate General of Shipping (DGS) was entrusted with the task of constituting
three committees for formulation of guidelines under the Shipbuilding Development
Scheme (SBDS) and the Shipbuilding Financial Assistance Scheme (SBFAS).
Accordingly, three committees were constituted:
1. Committee-I – For framing guidelines on the Shipbuilding Financial Assistance
Scheme (SBFAS).
2. Committee-II – For framing guidelines on Capacity and Capability Building of
Greenfield Shipbuilding Clusters and Brownfield Shipyard Expansion Projects.
3. Committee-III – For formulating Credit Risk Coverage Guidelines for
Shipbuilding Projects.
This report pertains to the work carried out by Committee-III, constituted to prepare
guidelines for Shipbuilding credit risk coverage under the 4th component of the
Shipbuilding Development Scheme (SBDS).
2. Objective of the Committee
The Committee was established to:
Operationalize the ₹1,443 crore corpus allocated under SBDS for Credit Risk
Coverage.
Develop the institutional and governance framework for the nomination,
onboarding, and functioning of credit risk cover agencies.
Define fund disbursement, reporting, and monitoring structures.
Ensure alignment with the Cabinet-approved framework for the Shipbuilding
Development Scheme (Pillar 3).
The guidelines aim to provide Indian shipyards with insurance-based protection
against pre-shipment, post-shipment, and vendor-related risks, strengthening
sectoral resilience and investor confidence.
33. Constitution of the Committee
As per MoPSW’s order, the Directorate General of Shipping (DGS) constituted
Committee-III with representation from:
MoPSW (Director–SBR)
Directorate General of Shipping (DGS)
ECGC Limited
New India Assurance (NIA)
Sagarmala Development Financial Corporation Ltd (SDFC)
Shipyards Association of India (SAI)
Shipbuilders and Industry Experts (SWAN Defence, L&T etc.)
Director (SBR), MoPSW served as the Member from the Ministry, and an officer from
DGS, Shri Ravi Kumar Moka, Ship Surveyor-cum-DDG (Tech), acted as the Member
Convener of the Committee.
4. Meetings Conducted with Stakeholders
Date Type Venue Participants
Online Stakeholder MoPSW, DGS, SAI, ISBA, CSL,
15.10.2025 Meeting with Core Virtual IRS, GMB, SCI, INSA, SRIA,
committee Industry representatives
Gujarat Maritime
Physical/Hybrid DGS, GMB, regional shipyards
Board Office, GIFT
17.10.2025 Stakeholder Meeting (L&T, ABG, Chowgule, Mandovi),
City, Ahmedabad
with Core committee cluster associations
(Hybrid)
Core Committee MoPSW (JS–SBR, Dir–SBR),
25.10.2025 Virtual
(Internal Review) DGS, ECGC, NIA
Physical/Hybrid Directorate DGS, ECGC, NIA, Shipyard
30.10.2025 Stakeholder Meeting General of representatives, APMB, SAI,
with Core committee Shipping (Hybrid) SWAN Defence, KPMG
45. Summary of Deliberations
5.1 Scope and Framework
The committee agreed that the credit risk coverage guidelines form a key risk
mitigation pillar under the Shipbuilding Development Scheme (SBDS) and would:
Be applicable to all registered Indian shipyards.
Operate through nominated government-owned insurance agencies (ECGC
& NIA).
Focus on pre-shipment, post-shipment, and vendor default insurance
products tailored to shipbuilding contracts.
5.2 Institutional Framework
Nodal Body: National Shipbuilding Mission (NSbM) – Apex oversight body.
Implementing Agency: Directorate General of Shipping (DGS) or Sagarmala
Financial Corporation Ltd (SFCL) to handle fund disbursal.
Credit Risk Cover Agencies: ECGC Ltd (for export-linked covers) and New
India Assurance (NIA) (for domestic shipbuilding).
Corpus Allocation: ₹1,443 crore to be disbursed annually or in multiple
tranches based on utilization and fund requirement.
6. Key Deliberations
6.1.1 The detailed list of deliberated items and inputs from stakeholders on the
Shipbuilding credit risk coverage guidelines are attached as Annexure-II.
6.1.2 The Minutes of meetings for the three core committee meetings with Industry
stakeholders and one core-committee meeting along with List of participants is
attached as Annexure-I.
7. Items to be Finalized with NSbM
The following aspects require policy-level finalization by the National Shipbuilding
Mission (NSbM):
1. Confirmation of the Implementing Agency (DGS or SFCL).
2. Corpus replenishment mechanism and flexibility for mid-term fund
augmentation.
3. Decision on allowing private insurers or reinsurance partners in subsequent
phases.
4. Approval mechanism for product design and pricing (through IMGB).
5. Standard MoU templates defining fund access, performance benchmarks, and
reporting structure.
56. Reinsurance and vendor default product design validation.
7. Actuarial study protocol and periodic review cycle.
8. Conclusion
The Committee on Shipbuilding Credit Risk Coverage completed its mandate by:
Conducting four comprehensive stakeholder consultations and one internal
meeting.
Consolidating and reviewing stakeholder inputs from ECGC, NIA, shipyards,
and industry bodies.
Finalizing the framework for credit risk coverage guidelines, incorporating
operational, financial, and institutional mechanisms.
The draft operational guidelines for the Shipbuilding Risk Coverage Scheme under
SBDS attached as Annexure-IV is accordingly submitted for Approval and onward
submission to the Ministry.
9. Annexures
Annexure I: Minutes of Meetings (dated 15.10.2025, 17.10.2025, 25.10.2025,
and 30.10.2025) along with List of participants.
Annexure-II : Consolidated Stakeholder Feedback/inputs Table on the
Shipbuilding Risk coverage Guidelines under SBdS.
Annexure III: Committee Constitution Orders (MoPSW O.M. dated
09.10.2025)
Annexure IV: Draft guidelines for Shipbuilding Risk coverage under SBdS.
Submitted by
(Ravi Kumar Moka)
Ship Surveyor-cum-Deputy Director General (Tech)
Member Convener – Committee on Shipbuilding Credit Risk Coverage
Directorate General of Shipping, Mumbai
To:
The Director General of Shipping
For onward submission to
Ministry of Ports, Shipping and Waterways (MoPSW)
Government of India
61st Online Stakeholder consultation Meeting
MOM of Core committee meeting with Stakeholders on Credit Risk
coverage
Date: 15th October 2025
Time: 11:45 hrs
Venue: Online Meeting
Convened by: DG Shipping, MoPSW
Participants:
Ravi Kumar SJ, DGS
K. Ramesh & Team (ECGC)
Sanjay Kumar & Team (NIA)
Abhinav Parpudi
Amit Dethe
Anuj Gupta
Other stakeholders
Key Discussion Points and Actions to be Taken
Corpus Utilization & Guidelines
Key Discussion Points:
Government approved outlay of ₹1,443 crore for credit risk cover under shipbuilding
scheme.
Corpus intended for payouts on defaults; operational costs to be recovered via nominal
premiums.
MoPSW to define process guidelines for fund release (annual/semi-annual/mid-year
contingency).
Leverage & Multiplier Factor
Key Discussion Points:
ECGC to propose leverage/multiplier factor based on risk profile and actuarial
evaluation.
MoPSW will not impose leverage; decision left to ECGC.
Policy Structure
Key Discussion Points:
7 Policies likely to be contract-specific, not blanket or annual.
Duration should align with shipbuilding timelines (2–6 years).
May require new product filing with IRDA for multi-year coverage.
Premium & Viability
Key Discussion Points:
Premiums should be nominal but su(cid:431)icient to maintain insurance principles.
Premium revenue to cover operational costs and capacity building.
Technical Expertise & Training
Key Discussion Points:
Need for sector-specific expertise for loss assessment and product design.
MoPSW to facilitate training and technical support.
Operational Mechanism
Key Discussion Points:
Corpus parked with MoPSW; ECGC to request funds based on underwriting plans.
Provision for additional corpus mid-year if initial allocation exhausted.
Contractual Issues”
Key Discussion Points:
Ownership and salvage rights in case of buyer insolvency discussed.
Industry practice: buyer ownership only after final payment; contract terms critical.
Risk & Insolvency Trends
Key Discussion Points:
Past insolvencies noted; data-driven approach recommended.
Shipyards generally conduct credit checks before signing contracts.
82nd Physical/Hybrid Stakeholder Consultation meeting
MOM of Core committee meeting with Stakeholders on Shipbuilding Credit
Risk coverage
Date: 17th October 2025
Time: 14:45 hrs to 15:20 hrs
Venue: Online Consultation
Convened by: Directorate General of Shipping (DG Shipping), Ministry of Ports, Shipping &
Waterways
Participants: (Full List of Participants is attached as Annexure-I).
Shri Vipul Singhal, Director, MoPSW
Shri Pradeep Sudhakaran, CSS, DGS
Shri Ravi Kumar, SS , DGS
Representatives from ECGC Ltd – Shri Suresh & Team
Representatives from NIA – Shri Bharat Bezawada & Ms. Swati Gupte
Shri Abhinav Parpudi, Consultant (MoPSW)
Meeting Objective
To finalize implementation guidelines for Credit Risk Cover under SBDS, focusing on
onboarding agencies, fund disbursement, reporting, and oversight. Product-specific details
to be addressed later.
Context and Opening Remarks
The meeting aimed to operationalize ₹14,143 crore allocation under SBDS for credit risk
coverage. Guidelines will define onboarding process, roles, fund transfer mechanism, and
monitoring framework. Product design will follow through stakeholder interactions.
Key Discussion Points and Actions to be Taken :
1. Scope of Guidelines
Key Discussion Points:
• Focus on onboarding credit risk cover agencies, defining roles, fund transfer process, and
monitoring mechanism.
• Product-specific details (pre-shipment, post-shipment, vendor default) will be finalized
later.
Actions to be Taken:
9• NSM to finalize implementing agency and issue nomination letters.
• Agencies to submit proposals with timelines for product development and fund
management.
2. Agencies & Nomination Process
Key Discussion Points:
• ECGC Ltd and NIA confirmed as initial agencies.
• Nomination letters to be issued by NSM after proposal evaluation.
• Communication routed through respective ministries, not directly to agencies.
Actions to be Taken:
• NSM to coordinate with ministries for o(cid:431)icial communication.
3. Implementing Agency & Fund Management
Key Discussion Points:
• Likely implementing agency: Sagarmala Development Financial Corporation (SDFC).
• Annual business plan required for year-on-year corpus allocation; mid-year
replenishment allowed if corpus exhausted.
Actions to be Taken:
• Implementing agency to prepare fund disbursement modalities.
4. Premium Structure & Nature of Insurance
Key Discussion Points:
• Premium to be nominal, covering operational and training costs; actuarial study will
determine actual rates.
• NSM approval required for each product; implementation agency to review premium
fairness.
• Insurance covers optional, not mandatory.
Actions to be Taken:
• Agencies to initiate actuarial studies and share findings with NSM.
5. Additional Points
10Key Discussion Points:
• Agencies must include fund management plan per IRDA norms.
• Corpus usage restricted to issuing covers and claim settlement only.
• NSM empowered to introduce new products without cabinet approval.
Actions to be Taken:
• Draft guidelines to incorporate premium study requirement and reporting obligations.
Decisions and Confirmations
Proceed with implementation guidelines based on:
• Agency onboarding via NSM nomination.
• Corpus management with annual and mid-year allocations.
• Quarterly reporting with flexibility for interim top-ups.
• NSM oversight for all approvals.
11ANNEXURE-II
LIST OF PARTICIPANTS FOR PHYSCIAL/HYBRID MEETING ON Capacity & Capability development
Guideliens under SbdS on 17-10-2025 @ GIFT City
Attended participants 113
Start time 10/17/25, 9:45:00 AM
End time 10/17/25, 3:56:49 PM
Meeting duration 6h 11m 48s
SNO Name Organization
1 Ravi Kumar(SS) DGS
2 GES GSL GSL
3 vijayendra Deshpande (Unverified) SAI
4 HSL (Unverified) HSL
5 Sabyasachi Majumder INSA
6 SAN MARITIME INDIA PVT LTD (Unverified) San Marine
7 IMU Prof. Sivakholundu IMU
8 CEO MMB MMB
9 SCI- N K Tripathi (Unverified) SCI
10 CAPT ARUN KUMAR SAI
11 Anshul Wadia Wadia
12 Naveen Kumar (External) IRS
13 GRSE (Unverified) ISBA
14 Hariprasad R (External) IRS-PMU
15 Ankush Raj SEED-EY
16 Rohit Tagade (External) IRS
17 San Marine Marine SanMarine
18 R. V. Vimal (External) SAI
19 Sanjeev (Unverified) SAI
20 Gaurav Bhalerao (External) SAI
21 CSL (Unverified) CSL
22 Jobin Joseph (Synergy) (Unverified) Synergy
23 Sanjiv Kapoor (External) SWAN DEFENCE
24 Akshay S SEED-EY
25 Sanjeev Shoft Shipyard (Unverified) SHOFT
26 prasanna kumar Wadia
27 Tanay Nagvekar Chowgule Lavgan Ship Repair Pvt Ltd
28 Sree Veeramanee N Chowgule Global Lavgan Shipyard
29 Sushil Rajmane (External) SAI
30 Akshay Jain | VEDAM (External) Vedam
31 Goa Shipyard Ltd (Unverified) GSL
32 shipbuilding-apmb (External) APMB
33 Dy CE (DPA) (Unverified) DPA
34 Capt. Kapil Kekre (External) INSA
1235 Nagesh Krishna Moorthy SAI
36 Aneena R Innocent SEED-EY
37 CSL Nagesh (Unverified) CSL
38 Anshuman Srivastava SAI
39 Attreya Sawantt Mandovi
40 Bosco D Silva MOC
41 Shri Vipul Singhal MoPSW
42 Dhrumil D Kelkar INSA
43 Amit Waje (External) IRS
44 SCI- N K Tripathi (Unverified) SCI
45 Pranav R Pai SRIA
46 Mitesh Agarwal (External) SRIA
47 Ram K (Unverified) TNMB
48 Traffic Manager, NMPA (External) NMPA
49 pranati (Unverified) SHOFT
50 Anuj Gupta KPMG-PMU
51 Prasad Sawant BuoyancyConsultants (External)
52 GSL (Unverified) GSL
53 Uday Bhatt.SRIA SRIA
54 pranati prabhu SHOFT
55 BHARATH KRISHNAN L&T Kattupalli
56 Naseer A SAI
57 Sanjiv Walia SAI
58 Rob (Unverified) MOC
59 Manager ( Environment and Safety) (Unverified) KMB
60 MMB (Unverified) MMB
61 Chief-Manager (Env&Safety), DPA (Unverified) DPA
62 Dharmesh Jani (Unverified) SAI
63 Gopi Krishna Sivvam (External) SRIA
64 Prantik Bhatt ISBA
65 ASHA V RAO (Unverified) CSL
66 Malika SeaTech (Unverified) SeaTech
67 Dethe, Amit KPMG
68 Amal Aloshie Vithayathil (External) IRS
69 PRADEEP ISBA
70 Janaki Ganesan SAi
71 Anil Jain (Unverified) SAI
72 Pravat Kusum Halder (External) Victoria shipyard
73 priyesh Kamat Synergy
74 Daniel (Unverified) SAI
75 sanjeev (Unverified) ECGC
76 MAZAGON DOCK SHIPBUILDERS LTD (External) MDL
77 Aaisha KS (External) SAI
78 Ankur Anal DGS
1379 san maritime (Unverified) San Marine
80 A C ROY (Unverified) AC ROY shipbuilders
81 Tom Davis, CSL (Unverified) CSL
82 Anuj Gupta (Unverified) KPMG-PMU
83 A S SAI
84 Suken Shah SAI
85 CMC (External) CMC
86 Vishal Jain SeaTech
87 dijo (Unverified) CSL
88 Sajan John (Unverified) CSL
89 IMU - Prof. Sivakholundu (Unverified) IMU
90 Saurabh Pradip Gadkari (External) SAI
91 anil jain (Unverified) Vedam
92 Harshita Raju ISBA
93 RAADS MARINE (Unverified) SAI
94 Harshita Jaiswal ISBA
95 Pandurang Dhond Chowgule
96 K.RAMESH (Unverified) NIA
97 Parpudi, Abhinav KPMG
98 Mehul Diwan SAI
99 SANJAY KUMAR ECGC NRO (Unverified) ECGC
14153rd Hybrid Core committee meeting
MOM of Core committee meeting with Stakeholders on Shipbuilding Credit
Risk coverage
Date: 25 October 2025
Time: 1400 – 1500HRS
Chair: Shri Venkateshpathy, Joint Secretary(SBR), MoPSW
Participants:
Shri Vipul Singhal, Director, MoPSW
Shri Pradeep Sudhakaran, CSS, DGS
Shri Ravi Kumar, SS , DGS
Representatives from ECGC Ltd – Shri Suresh & Team
Representatives from NIA – Shri Bharat Bezawada & Ms. Swati Gupte
Shri Abhinav Parpudi, Consultant (MoPSW)
1. Background
The meeting was convened to operationalize the Credit Risk Insurance Component of the
Shipbuilding Development Scheme (SbDS) approved by the Cabinet by ECGC & NIA and
to:
Finalize the implementation framework for Pre-shipment, Post-shipment, and
Vendor Default Insurance covers;
Identify implementing agencies;
Establish timelines and actionable items for inclusion in the SbDS Operational
Guidelines.
2. Key Discussions
2.1. MoPSW Introductory Remarks (JS)
The Cabinet has approved ₹1,443 crore outlay for Credit Risk Coverage under SbDS
till FY 2036.
NSbM will issue detailed guidelines within 90 days of Cabinet approval (as per
Appendix I of the Cabinet Note).
MoPSW proposes to nominate ECGC Ltd and New India Assurance (NIA) as
implementing agencies for export and domestic shipbuilding risk covers
respectively.
Three key clarifications sought:
1. Whether ECGC/NIA can directly float products under the scheme or require
approvals from SEBI/IRDA/parent ministries.
2. Whether funds can flow directly from the Consolidated Fund of India (CFI)
or require a layer such as Sagarmala Financial Corporation Ltd (SMFCL).
163. Tentative timelines for product formulation and presentation before the
Inter-Ministerial Governing Board (IMGB).
2.2. ECGC Response
Formal communication from MoPSW to ECGC (and its parent ministry, Department
of Commerce) is required to initiate product development.
The Vendor Default Insurance product falls outside ECGC’s current mandate and
needs IRDA and Department of Commerce clearance.
Once clearance is received, product rollout is possible within 3–4 months.
Actuarial studies will be conducted to determine risk leverage ratios and product
viability.
Noted need for possible replenishment of corpus over time, since one large claim
can deplete the ₹1,443 crore corpus.
2.3. NIA Response
NIA’s existing Trade Credit Insurance products cover up to six months’ credit
period, inadequate for shipbuilding’s 7–10-year project cycles.
Long-term credit exposure requires Surety Bond or Project Insurance products,
currently under development.
Reinsurance support from global partners will be necessary due to large risk
aggregation per project (₹200–300 crore average exposure).
Proposed actuarial assessment of coverage structure and corpus adequacy.
2.4. Discussion Points
Director (MoPSW) emphasized that products should be customized for shipyard-
specific needs, not generic trade policies.
Premiums must be nominal, prioritizing sectoral development rather than
profitability.
Government will provide annual corpus infusion; insurance products must be
designed for self-sustenance and scalability.
NSbM will seek business plans from ECGC/NIA for annual risk coverage and
required corpus leveraging.
Provision to replenish corpus mid-term in case of extraordinary events (force
majeure, market collapse, etc.) will be included in guidelines.
ECGC/NIA to engage in detailed stakeholder consultations with shipyards before
finalizing products.
3. Framework for Guidelines (as agreed)
1. Implementing Agencies
17o ECGC Ltd: Export-related risk covers (Pre-shipment, Post-shipment, Vendor
Default – export).
o New India Assurance (NIA): Domestic shipbuilding risk covers and Surety
Bonds.
2. Guiding Principles
o Premiums to be kept minimal considering Government corpus support.
o Annual corpus allocation based on leveraging ratio and business plan
submitted to NSbM/IMGB.
o Detailed actuarial justification to be part of each agency’s submission to
their regulatory authority and NSbM.
o Products to ensure financial sustainability with periodic actuarial review.
3. Fund Flow
o Option 1: Direct fund flow from Consolidated Fund of India to ECGC/NIA.
o Option 2: Layered mechanism through Sagarmala Financial Corporation
Ltd (SMFCL) (MoPSW to decide based on DoE advice).
o
4. Product Approval & Timelines
o MoPSW to issue formal communication to ECGC and NIA by 30 Oct 2025
authorizing product development.
o Both agencies to present draft products to IMGB/NSbM..
o IMGB approval is needed to enable the launch of the scheme.
5. Closing Remarks
JS emphasized that ECGC and NIA, being Government institutions, are to act as
pilot agencies under this scheme.
Both agencies will independently design and propose risk coverage products;
duplication is to be avoided.
NSbM Secretariat will coordinate all inter-agency communication.
Director (MoPSW) reiterated that the guidelines must remain simple, generic, and
flexible within the ambit of the Cabinet-approved DCN Pillar 3 document.
The meeting concluded with Vote of thanks to the chair.
184th Physical/Hybrid Stakeholder Consultation meeting
MOM of Core committee meeting with Stakeholders on Shipbuilding
Risk coverage Guidelines)
Time: 17:00 -19:00
Venue: Hybrid (DG Shipping HQ and online)
List of Participants : (Full List of Participants is as per Annexure-II)
DG Shipping (Pradeep Sudhakaran, Ravi Kumar Moka, Ankur Anal, PMU.
Ministry of Ports/Shipping/Waterways (MoPSW), NSBM, national shipyard
associations (SAI, INSA)
Major shipyards (Aatreya, SDHI, L&T, Aatreya, San Marine, Chowgule, APMB,
CSL, HSL, )
Researchers, evaluation agency reps), IMU,
State Maritime Boards (GMB, Andhra Pradesh)
NIA/ECGC, finance experts
Key Discussion Points:
• Objective: Operationalize ₹1,443 crore allocation under SBDS for credit risk coverage.
• Guidelines focus on onboarding agencies, defining roles, fund transfer process, and
monitoring mechanism.
• Product-specific details (pre-shipment, post-shipment, vendor default) will follow later
through stakeholder interactions.
Actions to be Taken:
• NSM to finalize implementing agency and issue nomination letters.
• Agencies to submit proposals with timelines for product development and fund
management.
2. Agencies & Nomination Process
Key Discussion Points:
• ECGC Ltd and NIA confirmed as initial agencies.
• Nomination letters to be issued by NSM after proposal evaluation.
• Communication to route through respective ministries, not directly to agencies.
3. Implementing Agency & Fund Management
19Key Discussion Points:
• Likely implementing agency: Sagarmala Development Financial Corporation (SDFC).
• Annual business plan required for year-on-year corpus allocation; mid-year
replenishment allowed if corpus exhausted.
Actions to be Taken:
• Implementing agency to prepare fund disbursement modalities.
4. Premium Structure & Nature of Insurance
Key Discussion Points:
• Premium to be nominal, covering operational and training costs; actuarial study will
determine actual rates.
• NSM approval required for each product; implementation agency to review premium
fairness.
• Insurance covers optional, not mandatory.
Actions to be Taken:
• Agencies to initiate actuarial studies and share findings with NSM.
5. Additional Points
Key Discussion Points:
• Agencies must include fund management plan per IRDA norms.
• Corpus usage restricted to issuing covers and claim settlement only.
• NSM empowered to introduce new products without cabinet approval.
Actions to be Taken:
• Draft guidelines to incorporate premium study requirement and reporting obligations.
20Summary of Queries and Replies:
SN Inputs/clarification sought DGS Clarification
1 It was clarified that presently only
Agencies sought clarification on the ECGC and NIA will be nominated by
nomination processes for selection of NSbM. Communication in this regard
credit risk coverage provider will be routed through respective
ministries.
3
The stakeholders sought clarity on
It was clarified by ECGC and NIA that
the term "Nominal Premium" in the
an actuarial study is required, without
draft guideline and requested to
which quantification of premium is not
quantify the same as the premium for
possible. DGS and MOPSW further
these covers will be additional cost to
clarified that these premiums will be
shipyard and/or shipowners as
reviewed and approved by NSbM.
passed on cost
3 Query on mandatory nature of It was clarified that these insurance
insurance - Stakeholders sought covers will be optional and not
clarification whether the insurance mandatory for the shipyards, and be
would be mandatory for shipyards based on shipyard risk appetite
4 They requested clarification on the
It was requested from the insurance
fund management strategy for the
agencies to incorporate an IRDAI-
corpus, as the funds would remain
compliant fund management plan
idle in the absence of claims,
within their proposals.
particularly during the initial phase.
5 Stakeholders discussed whether the
It was clarified that as per the
corpus under this scheme could also
approved cabinet note the corpus is
be utilized to subsidize insurance
restricted to cover claim settlement
premiums in addition to covering
only
claims
6
It was clarified that funds allocated to
A query was raised on whether funds each pillar are separate and distinct;
allocated under various pillars, such however, reallocation within
as SBFAS, MDF, and SbDS, can be subschemes under the same pillar
utilized interchangeably. may be permitted with the approval of
the competent authority.
217 A query was raised on whether any of
these insurance products would also It was clarified by ECGC that none of
cover litigation costs incurred by these insurance policies will cover the
shipyards prior to the processing of litigation costs.
claim settlements.
8 It was clarified that presently only
Agencies sought clarification on the ECGC and NIA will be nominated by
nomination processes for selection of NSbM. Communication in this regard
credit risk coverage provider will be routed through respective
ministries.
22ANNEXURE-IV
LIST OF PARTICIPANTS FOR PHYSCIAL/HYBRID MEETING ON SBFAS & SBdS, Credit Risk cover Guidelines on 30-10-2025
Attended participants 64
Start time 10/30/25, 1:20:19 PM
End time 10/30/25, 6:44:57 PM
SNO Name Organizaion Email
1 Ravi Kumar(SS) DGS ravi.k43@dgsmumbai.onmicrosoft.com
2 DIRECTORATE GENERAL OF SHIPPING-INDDIGAS Directorate@dgsmumbai.onmicrosoft.com
3 Anil Devli, CEO INSA (External) INSA ceo@insa.org.in
4 Amal Aloshie Vithayathil (External) IRS Amal.Aloshie@irclass.org
5 Amit Waje (External) IRS Amit.Waje@irclass.org
6 Uday Bhatt.SRIA SRIA
7 Pandurang Dhond | Ship Building DivisionC (Ehxotwergnualel) pandurang.sbd@chowgule.co.in
8 Capt. Kapil Kekre (External) INSA kekre@insa.org.in
9 Nihal (Unverified) SAI
10 Prashant Asogekar | Ship Building Division (External) prashant.asogekar@chowgule.co.in
11 CSL (Unverified) CSL
12 Daniel (Unverified) SAI
13 AMAL (Unverified) IRS
14 Srinivasa Rao P (Unverified) HSL
15 Ankur Anal DGS ankuranal@dgsmumbai.onmicrosoft.com
16 K Swaminathan (External) SWAN Defence cdr.swaminathan@swan.co.in
17 Rekha CSLA (Unverified) CSLA
18 Goa Shipyard Limited (Unverified) GSL
19 shipbuilding-apmb (External) APMB shipbuilding-apmb@apmaritime.in
20 Joseph MATHEW Seatrium joseph.mathew@seatrium.com
21 Sanjiv Kapoor (External) SWAN Defence sanjiv.kapoor@swan.co.in
22 ASHA (Unverified) SAI
23 R. V. Vimal (External) Chowgule vimal@chowguleglobal.in
24 priyesh Kamat Synergy
25 Sanjay | Guidance Tamil Nadu (UnverifiedG)uidance Tamilnadu
26 Prantik ISBA
27 Prathamesh Bam Chowgule Lavgan Shipyard ca@chowgulelavgan.com
28 Aaisha KS (External) San Marine aaisha.ks@titagarh.in
29 Jignesh Shah (External) SWAN Defence jignesh.shah@swan.co.in
30 SANJIV WALIA SAI
31 Attreya Sawantt Mandovi
32 Mitesh Agarwal (External) SWAN LNG mitesh.a@swanlng.co.in
33 sivakholundu (Unverified) IMU
34 Anil Jain (Unverified)
35 Rajeev Nayyer (External) SWAN defence rajeev.nayyer@swan.co.in
36 Gupta, Anuj PMU-KPMG anujgupta21@kpmg.com
37 Dethe, Amit PMU_KPMG amitdethe@kpmg.com
38 Tom (Unverified)
39 ECGC LTD (Unverified) ECGC
40 Abhinav (Unverified) ECGC
41 PALANIMUTHU GOPAL L&T PALANIMUTHU.G@larsentoubro.com
42 Swati Gupte - NIA (Unverified) NIA
43 Sanjay Kumar ECGC
44 Pallavi sinha, New india (Unverified) NIA
2324INPUTS FROM STAKEHOLDERS ON THE SBdS - Shipbuilding Credit Riesk coverage guidelines
Discussion Held on 15 Oct 2025
Name of
S.No Inputs Reply from DGS official
person/organization
Asked about the modalities of corpus utilisation
— whether the ₹1443 crore fund would be Corpus will be distributed annually or multi-year
1 NIA provided yearly or upfront, and how depending on insurer’s underwriting plan. Additional
claims/defaults would be handled at the funds can be requested mid-year upon justification.
operational level.
Queried about ownership of partially built
Ownership depends on the contract; generally, the
vessels (70–80% completed) in the event of
2 NIA shipbuilder retains ownership until full payment.
buyer insolvency, and who retains salvage
Buyer’s claim is limited to unpaid value.
rights.
Raised issue of whether ship-wise or master Individual contract-wise policies preferred; duration
3 NIA policies will be used and how long the coverage may exceed 12–18 months for complex ships. Insurers
period will be. may file a new multi-year policy with IRDAI.
Highlighted that actuarial data on past DGS agreed; suggested compiling data from shipyard
4 NIA insolvencies and default trends is crucial for associations and class societies to support product
designing a viable product. design and reinsurer engagement.
Emphasised need for sector-specific technical
MoPSW will facilitate capacity-building programmes
5 ECGC expertise to assess risk and quantify losses;
and technical training through maritime experts.
requested ministry support.
Insurers can charge nominal premiums to shipyards to
Asked whether operational expenses can be
6 ECGC recover operational and training costs, while the
covered via premiums.
corpus covers risk payouts.
MoPSW will not fix leverage; insurer’s actuarial team
Queried about the leverage or multiplier ratio
7 ECGC to determine multiplier (e.g., 5× or 10×). Ministry will
for corpus utilisation and exposure limits.
define only the fund-release process.
Suggested establishing a Committee of
DGS agreed in principle; governance structure to be
8 ECGC Directions (COD) similar to NEIA for
discussed further with MoPSW.
underwriting decisions.
Mentioned importance of defining cost- DGS concurred — premiums should remain low but
9 ECGC effective yet viable premium rates to maintain viable; corpus may grow over time if payouts are
prudence among insured entities. minimal.
Discussion Held on 17 Oct 2025
Name of person /
Sr No. Input / Point of Discussion DGS/MoPSW Reply
organization
DGS or SFCL will act as the Implementing Agency with
The group requested details of the onboarding oversight by the NSbM Inter-Ministerial Governing
10 NIA/ECGC process and the oversight structure for the Board; agencies will be onboarded via EOI and formal
scheme. MoUs defining scope, corpus access, reporting, and
performance obligations.
The participants asked for detailed product- Meeting scope is limited to implementation guidelines
level clarifications on what would be covered covering onboarding, fund disbursal, reporting, and
11 NIA/ECGC
under pre-shipment, post-shipment, and vendor timelines; product specifications will be developed in
default insurance. subsequent sessions with insurers and shipyards.
25Product design will not be finalized at this stage;
The stakeholders requested confirmation on
today’s focus is on governance and process for
12 NIA/ECGC whether product design details would be
operationalization, with product terms to be co-
finalized during this meeting.
developed after onboarding.
The group sought clarity on the eligibility of Agencies are currently envisaged as government/PSU
insurance agencies, specifically whether entities entities (e.g., NIA, ECGC) selected via an EOI process
13 NIA/ECGC
beyond government/PSU (including private and formalized by MoU; any inclusion of private
insurers) could participate. insurers can be escalated to NSbM for consideration.
The corpus will be centrally managed by the
The stakeholders asked for clarity on the
Implementing Agency under NSbM oversight;
14 NIA/ECGC mechanism for corpus replenishment and its
additional funding is subject to NSbM decisions and
governance.
overall corpus availability.
The Implementing Agency will manage the corpus with
The stakeholders asked how fund disbursals
annual releases and mid-year top-ups (if required).
15 NIA/ECGC would be structured (annual versus mid-year
There will be quarterly reporting, details of which will
releases) and what records would be required.
be set out in MoUs/agreements.
The stakeholders raised concerns about the It was clarified that annual allocations will be provided
potential early exhaustion of the allocated with flexibility for mid-year top-ups based on
16 NIA/ECGC
annual corpus and the need for mid-year fund utilization and demand, and interim requests will be
availability. considered.
The participants asked how catastrophic events
(such as a pandemic) would be handled if they It was submitted that such extreme scenarios will be
17 NIA/ECGC
depleted the overall scheme corpus before deliberated with NSbM.
March 2036.
The agency requested clarity on whether
policies would be issued in the name of the NEIA-like corpus-backed underwriting structures may
insurer (e.g., ECGC/NIA) or the Implementing be referenced; specific arrangements will be defined in
18 ECGC
Agency (DGS/SFCL), and who would bear agreements and product documentation and taken up
liability if funds were unavailable at the time of with NSbM.
claim.
referenced leverage is indicative and dependent on
The insurer asked how leverage assumptions
underwriter risk assessment; if claim pay-outs exceed
(for example, a 20x illustration) would be
19 NIA the agency-level corpus, the Implementing Agency may
determined and whether they would be
allocate additional funds subject to overall corpus
sufficient under high-claims scenarios.
availability and NSbM decisions.
Premiums will be kept nominal due to the seed corpus
The participants asked whether Implementing
being provided by GoI. It should primarily cover
Agency will have directions / restrictions on
20 NIA/ECGC operating expenses and capacity building; pricing
quantum of the policy premiums and what
mechanics will be finalized during product/agreements
costs they are intended to cover.
based on insurer risk assessment.
As the Vendor Default Cover is a new concept in
the Indian context, the group sought clarity on As correctly mentioned, the Vendor Default Cover is a
the scope and triggers for Vendor Default, new concept in the Indian context; its scope will be
21 NIA/ECGC including warranty support failure, vendor developed during product design. DGS/MoPSW will
insolvency, and quality/specification failures. endeavour to coordinate with industry stakeholders to
They also requested to share literature and share literature and references in this regard.
references on the same from other countries.
Quarterly reporting is envisaged with flexibility for
The stakeholders asked about the reporting
interim threshold-based requests; the Implementing
22 NIA/ECGC mechanism and utilization monitoring
Agency will monitor utilization and performance and
requirements.
escalate to NSbM as required.
26The participants asked about the expected Timelines will be defined during onboarding and in
23 NIA/ECGC timelines for rolling out products after agreements; the immediate priority is to finalize
onboarding. implementation guidelines by 24 October 2025.
It was also discussed if a government run
insurer can become the Implementation Agency
Chowgule- Sagar This point was noted and will be deliberated further
24 instead of DGS or SFCL, due to specific expertise
satpute with NSbM.
required to monitor and manage the insurance
products.
The stakeholders asked whether reinsurance
Reinsurance may be explored during product design,
would be included as part of risk layering for
25 NIA/ECGC with cost and structure to be determined in
the products as the reinsurance may increase
coordination with the agencies.
cost and hence the policy premiums.
Discussion Held on 30 Oct 2025
Agencies sought clarification on the nomination It was clarified that presently only ECGC and NIA will
26 NIA/ECGC processes for selection of credit risk coverage be nominated by NSbM. Communication in this regard
provider will be routed through respective ministries.
The stakeholders sought clarity on the term It was clarified by ECGC and NIA that an actuarial study
"Nominal Premium" in the draft guideline and is required, without which quantification of premium is
27 Chowgule SBD requested to quantify the same as the premium not possible. DGS and MOPSW further clarified that
for these covers will be additional cost to these premiums will be reviewed and approved by
shipyard and/or shipowners as passed on cost NSbM.
Query on mandatory nature of insurance - It was clarified that these insurance covers will be
28 Chowgule SBD Stakeholders sought clarification whether the optional and not mandatory for the shipyards, and be
insurance would be mandatory for shipyards based on shipyard risk appetite
They requested clarification on the fund
It was requested from the insurance agencies to
management strategy for the corpus, as the
29 NIA/ECGC incorporate an IRDAI-compliant fund management plan
funds would remain idle in the absence of
within their proposals.
claims, particularly during the initial phase.
Stakeholders discussed whether the corpus
under this scheme could also be utilized to It was clarified that as per the approved cabinet note
30 Shri Rajiv Nayyar- SWAN Defence
subsidize insurance premiums in addition to the corpus is restricted to cover claim settlement only
covering claims
It was clarified that funds allocated to each pillar are
A query was raised on whether funds allocated
separate and distinct; however, reallocation within
31 Shri Rajiv Nayyar- SWANun Ddeefre vnacreious pillars, such as SBFAS, MDF, and
subschemes under the same pillar may be permitted
SbDS, can be utilized interchangeably.
with the approval of the competent authority.
A query was raised on whether any of these
insurance products would also cover litigation It was clarified by ECGC that none of these insurance
32 Shri Rajiv Nayyar- SWAN Defence
costs incurred by shipyards prior to the policies will cover the litigation costs.
processing of claim settlements.
27No. SY - 13017 lll2025-SBR
flT{A'TSilt
Government of lndia
q6a, q!6 qftT6t 3itt ilffirrt d"rfic
Ministry of Ports, Shipping and Waterways
st fi.arr 4mr / SBR Section)
qft{64 ffifr I Transport Bhawan,
r - fifEentl I - Parliament Street,
ngAlFfi- l100ol / New Delhi - 1l00ol
Eai{. / Dated: ogth October, 2025
OFFICE MEMORANDUM
Subject: constitution of the stakeholders consultation committees to
facilitate drafting of guidelines on 'scheme for Capacity & Capability
Development and Credit Risk Coverage for Shipbuilding in India' - reg.
The undersigned is directed to state that the Govemment has approved the
,scheme for Capacity & Capability development and credit risk coverage for
Shipbuilding in India-Shipbuilding Development Scheme' for the promotion of the
shipbuilding sector in India. Extract of the approved scheme is attached as
Annexure. Two sets of Guidelines for the scheme are to be issued for
operationalization and implementation of the scheme. For the purpose of drafting
these guidelines, following committees are to be constituted'
2. (i) The Directorate General of Shipping may constitute a committee of
stakeholders, such as, Indian Maritime University, Centre of Excellence in
Maritime and shipbuilding, Shipyards Association of India, Indian Shipbuilder
Association, Cochin Shipyard Limited, Indian Register of Shipping, Indian Marine
Designers Association. Director (SBR), MoPSW shall be a member of the
Committee and an officer with adequate seniority fiom Directorate General of
Shipping shall be the member convener of the committee.
(ii) The above committee shall hold consultations with all concerned
stakeholders including shipyards (domestic as well as intemational) and shipping
institutions (domestic as well as intemational) and shall formulate draft guidelines
on following components of the scheme, namely, 'Capital support for greenfield
capacity expansion', 'Capital assistance to existing/ brownfield shipyards towards
the expansion of production capacity' and 'Capability development initiatives'.
283. (i) The Director General of Shipping may constitute a second Committee
of
comprising stakeholders, such as, New India Assurance, Export Credit
Guarantee Corporation of Indi4 Sagarmala Finance Corporation Limited, Indian
Shipbuilder Association, Shipyards Association of India, Cochin Shipyard
Limited. Director (SBR), MoPSW shall be a member of the Committee and an
officer with adequate seniority from Directorate General of Shipping shall be the
member convener of the committee.
(ii)
The above committee shall hold consultations with all concemed
stakeholders including shipyards (domestic as well as international), shipping
institutions (domestic as well as intemational), financial institutions and shall
formulate draft guidelines on the 'shipbuilding risk coverage' component of the
scheme.
4.
Director General of Shipping shall submit these two draft guidelines to the
MoPSW by 24th October, 2025.
5.
This issues with approval of the competent authority.
*YaIY4rc\"y{
(Y#i-nav Mittalyl t
Under Secretary to the Government of India
Email id: usshipping2-psw@gov.in
Tel No.: 01f- 2331f659
To
Directorate General of Shipping,
{Kind Attn.: Shri Shyam Jagannathan, DGS}
9'n Floor Beta Building,
i-Think Techno Campus,
Kanjur Marg (East), Mumbai -
Copy to:
i.
Office of Secretary (PSW)
ii.
Office of SS(PSW)
iii.
Oflice of JS (S)
iv.
Director (SBR)
29भारत सरकार/ GOVERNMENT OF INDIA
प(cid:419)न,पोत प(cid:464)रवहन और जलमाग (cid:91)मं(cid:287)ालय /
MINISTRY OF PORTS, SHIPPING AND WATERWAYS
नौवहन महा(cid:467)नदेशालय, मबुं ई
DIRECTORATE GENERAL OF SHIPPING, MUMBAI
File No: 26-12/9/2022-NA - DGS Dated :12-10-2025
Order
Subject: Constitution of Credit Risk Coverage Core Committee for Drafting Guidelines Under
Shipbuilding Development Scheme (SbDS).
In pursuance of the Government of India’s approval for the Scheme for Capacity Capability
Development and Credit Risk Coverage for Shipbuilding in India (Shipbuilding Development Scheme
— SbDS), and as per Ministry of Ports, Shipping and Waterways (MoPSW) directions, the following
committee is constituted for preparing draft guidelines for Credit Risk coverage and for conducting
stakeholder outreach and workshops for industry inputs.
1. Committee Constitution
The Credit Risk Coverage Core Committee as decided by the Competent authority shall comprise the
following members:
S. No. Representative Organization/Association Name Role
Ministry of Ports, Shipping and Waterways
1 Director (SBR) Member
(MoPSW)
Member
2 Representative Directorate General of Shipping (DGS)
Convener
3 Representative New India Assurance Co Ltd Member
Export Credit Guarantee Corporation of India(
4 Representative Member
ECGC)
5 Representative Sagarmala Finance Corporation Limited (SMFCL) Member
6 Representative Shipyards Association of India (SAI) Member
7 Representative Indian Shipbuilder Association (ISBA) Member
8 Representative Shipping Corporation of India (SCI) Member
9 Representative Cochin Shipyard Limited (CSL) Member
The Committee may co-opt other experts/ Stakeholders, as considered necessary for its deliberations.
___________________________________________________________________________________________________________________
बीटा (cid:466)ब(cid:227) डीगं , 9वी मंिजल, आई (cid:876)थकं टे(cid:200) नो कै(cid:224) पस, काजं ूर माग (cid:91)(पवू )(cid:91), मंबई – 400 042
Beta Building, 9th Flr., I-Think Techno Campus, Kanjur Marg (E) / Mumbai – 42
फोन/Tel.: 91-22-25752040/1/2/3, फै(cid:200) स/Fax.: 91-22-25752029/353 ई0-मेल/E-mail : dgship-dgs@nic.in वेबसाईट /Website: www.dgshipping.gov.in2. Mandate
(I) Draft guidelines for the credit risk coverage offered to shipyards in accordance with the approved
scheme and reference documents from MoPSW attached as Annexure-I.
(II) Conduct stakeholder outreach and workshops to gather industry inputs on the guidelines.
3. Terms of Reference(TOR) of the Committee:
Review the approved scheme and relevant directives on credit risk coverage of Shipbuilding
Development Scheme (SbDS).
Draft comprehensive guidelines for credit risk coverage offered to shipyards, in consultation
with all stakeholders.
Ensure alignment of guidelines with scheme objectives and requirements of all stakeholders.
Hold consultations, outreach events, and industry workshops to ensure broad-based
participation and feedback.
Submit consolidated draft guidelines to the Directorate General of Shipping for onward
transmission to MoPSW by the stipulated date.
4. Timeline
The Committee shall submit the draft guidelines to the Directorate General of Shipping by 24th
October, 2025.
The committee may convene meetings and workshops as required to ensure timely completion
of the mandate.
5. Secretariat and Coordination
The Directorate General of Shipping shall provide secretarial and administrative support to the
Committee.
6. General
All concerned departments, agencies, and stakeholders are requested to extend full
cooperation to the Committee for effective framing of the guidelines.
7. This order is issued with the approval of the Competent Authority.
Ravi Kumar M
Ship Surveyor-cum-
Deputy Director General (Tech)
Directorate General of Shipping
Encl.:
Annexure I: Extract of Approved Shipbuilding Development Scheme (SbDS)
Annexure II: List of Committee Members
To,
1. All Organizations/Stakeholders as per Annexure-II.
31Annexure II: List of Committee Members
Credit Risk Coverage Core Committee: List of Members
S.
Organization/Association Name Name of the Members
No.
Ministry of Ports, Shipping and
1 Shri Vipul Singhal, Director (SBR)
Waterways (MoPSW)
Shri Ravikumar Moka, SS-cum-DDG(Tech)-
2 Directorate General of Shipping (DGS) Member Convenor
Shri Ankur Anal, JSS-cum-ADG (Tech)
Shri K Ramesh, General Manager
3 New India Assurance Co Ltd
Smt Swati Gupte, Chief Manager
Export Credit Guarantee Corporation Shri Subhash Chahar, DGM
4
of India (ECGC) Ms. Aarti Pandey, DGM
Sagarmala Finance Corporation
5 Shri Dinesh Kumar, Director (Sagarmala)
Limited (SMFCL)
Shri Sagar Satpute, CCPL
6 Shipyards Association of India (SAI)
Shri Rajeev Nayyar, SDHI
7 Indian Shipbuilder Association (ISBA) Shri Palanimuthu G, DGM, L&T
8 Shipping Corporation of India (SCI) Shri. Shyamalendu Bhushan Das, GM
9 Cochin Shipyard Limited (CSL) Ms. Asha V Rao, AGM (Fin)
32DRAFT GUIDELINES FOR SHIPBUILDING RISK COVERAGE
under Shipyard Development Scheme (SBdS)
1. (a) Title: The scheme for providing Capital support for greenfield capacity expansion,
capital assistance for brownfield shipyard expansion , capability development through
India Ship Technology Centre and providing shipbuilding risk coverage shall be called
“Shipbuilding Development Scheme ” and the guidelines formulated to implement the
scheme together shall be called “Guidelines for Implementation of Shipbuilding
Development Scheme(SbDS)”.
(b) Validity: The Shipbuilding Development Scheme and the guidelines shall come
into force with effect from XXX and remain valid for all Detailed Project Reports (DPRs)
submitted from XXX to 31 March 2036, including the said dates.
(c) Applicability: The scheme for providing shipbuilding risk coverage shall apply to
all existing Indian shipyards that are duly registered.
2. Definitions.
a) SbDS (Shipbuilding Development Scheme) - A government initiative aimed at enhancing
domestic shipbuilding capacity and competitiveness through financial support and risk
mitigation.
b) NSbM (National Shipbuilding Mission) - The apex body responsible for overseeing the
implementation of shipbuilding schemes including SbDS.
c) Implementation Agency - The designated government entity (e.g., Directorate General of
Shipping or Sagarmala Financial Corporation Limited) responsible for releasing funds to
nominated credit risk cover agencies.
d) Credit Risk Cover Agencies - Government-owned entities or public sector undertakings
nominated by NSbM to design and administer insurance products for shipbuilding-related
risks.
33DRAFT GUIDELINES FOR SHIPBUILDING RISK COVERAGE
under Shipyard Development Scheme (SBdS)
e) Pre-Shipment Insurance - Insurance product that covers financial losses due to buyer default
or cancellation during vessel construction.
f) Post-Shipment Insurance - Insurance product that covers risks of non-payment after vessel
delivery due to disputes, defects, or political factors.
g) Vendor Default Insurance - Insurance product that protects shipyards from losses due to
vendor failure to deliver critical components.
h) Corpus - The total financial allocation under SbDS (₹1,443 crore) designated for credit risk
coverage.
i) Nomination Solicitation - The process by which NSbM invites proposals from eligible entities
to serve as credit risk cover agencies.
j) Performance Metrics - Criteria used to evaluate credit risk cover agencies, including claim
settlement time, accuracy of loss estimation, and stakeholder
3. Purpose
The objective of this guideline is to operationalize the ₹1,443 crore allocation under the
Shipbuilding Development Scheme (SbDS) for credit risk coverage. This initiative aims to provide
financial protection to Indian shipyards against key risks associated with shipbuilding contracts
and vendor dependencies. By offering structured insurance products, the scheme is intended to
insulate shipyards from various types of risks in undertaking both domestic and export-oriented
shipbuilding projects, thereby strengthening the sector’s resilience, competitiveness, and long-
term viability.
34DRAFT GUIDELINES FOR SHIPBUILDING RISK COVERAGE
under Shipyard Development Scheme (SBdS)
4. Institutional Framework
The Implementation Agency for this scheme will be the Directorate General of Shipping or
Sagarmala Financial Corporation Limited. The Implementation Agency will be solely responsible
for the release of funds to the nominated credit risk cover agencies. It will not be involved in
product development, underwriting, or oversight functions.
4.1 Step 1: Nomination of Credit Risk Cover Agencies
Credit risk cover agencies will be responsible for developing the financial products to be offered
to the Indian shipbuilding sector. These agencies will be nominated directly by NSbM after
evaluating proposals submitted by eligible government entities.
4.1.1 Eligibility Criteria
Only government-owned entities or public sector undertakings shall be eligible for nomination as
credit risk cover agencies under this scheme. These entities must demonstrate either substantial
experience in the maritime domain or a proven track record in administering credit risk or
insurance products in infrastructure, export, or industrial sectors.
4.1.2 A Nomination Solicitation
NSbM will seek nominations from all eligible and relevant government entities to provide the credit
risk covers as approved by the Cabinet. This process will ensure transparency, inclusivity, and
alignment with the strategic objectives of the scheme.
4.1.3 Nomination Process
NSbM shall directly nominate credit risk cover agencies based on proposals received from eligible
government entities. The Implementation Agency will act upon NSbM’s nominations and release
funds accordingly.
Proposals will be evaluated based on:
35DRAFT GUIDELINES FOR SHIPBUILDING RISK COVERAGE
under Shipyard Development Scheme (SBdS)
Demonstrated domain expertise in maritime or infrastructure insurance
Capacity to underwrite and manage large-scale credit risk covers
Existing operational frameworks for policy issuance, claims management, and fund
administration
Ability to scale operations and customize insurance products to meet the specific needs
of the shipbuilding sector
The final nomination of agencies and the categories of insurance products to be developed will
be subject to approval by the Inter-Ministerial Governing Board constituted under NSbM.
4.1.4 Designation and Onboarding
Once nominated by NSbM, credit risk cover agencies will be formally designated through Letters
of Nomination issued by NSbM. Each agency will enter into an agreement with the Implementation
Agency, which will define the scope of fund access, reporting obligations, and performance
benchmarks.
This agreement will serve as the operational foundation for the agency’s role in administering
credit risk covers under SbDS.
4.2. Corpus Access and Fund Allocation
Step 2: Corpus Management
The corpus allocated under SbDS for credit risk coverage shall be centrally managed by the
Implementation Agency with the approval of NSbM.
Funds will be allocated to the nominated credit risk cover agencies on a financial year basis.
The allocation will be determined based on projected demand from shipyards, historical utilization
trends, and prevailing market conditions that influence risk exposure.
36DRAFT GUIDELINES FOR SHIPBUILDING RISK COVERAGE
under Shipyard Development Scheme (SBdS)
A mid-year allocation may be considered on a request basis depending upon the fund requirement
raised by the Implementation Agency as a formal submission.
4.3 Step 3: Initial Disbursement
An initial tranche of funds will be disbursed by the Implementation Agency to credit risk cover
agencies to enable the immediate rollout of credit risk cover products.
Subsequent disbursements will be linked to performance indicators such as policy uptake, claims
processed, and fund utilization efficiency.
Credit risk cover agencies will provide annual business plans to justify the release of additional
corpus.
4.4 Credit Risk Cover Products
Step 4: Product Design
Credit risk cover agencies shall design and offer the following credit risk cover products:
Pre-Shipment Insurance (Buyer’s Default): Protects shipyards from financial losses due
to buyer cancellation or default during vessel construction. Covers incurred production
costs and potential lost profits.
Post-Shipment Insurance: Covers risks of non-payment by the buyer after vessel
delivery due to disputes, defects, political instability, or other factors.
Vendor Default Insurance: Protects shipyards against losses from vendor failure to
deliver critical components. Covers advances paid to vendors.
Credit risk cover agencies will also be responsible for ensuring all relevant regulatory compliances
for the products they develop, including obtaining necessary approvals from their parent entities
or administrative ministries.
37DRAFT GUIDELINES FOR SHIPBUILDING RISK COVERAGE
under Shipyard Development Scheme (SBdS)
Additionally, credit risk cover agencies must commit to specific timelines for product development,
internal and external approvals, and introduction of the products in the market to ensure timely
rollout and sectoral impact.
The Implementation Agency shall monitor adherence to these timelines and regulatory obligations
through periodic progress reports submitted by the credit risk cover agencies. Any delays or
deviations shall be escalated to NSbM for review and corrective action.
4.5 Step 5: Customization
All insurance products must be tailored to reflect the unique structure of shipbuilding contracts,
including advance payments, milestone-based payments, delivery-linked payments, and retention
money.
Credit risk cover agencies may offer bundled or modular products based on shipyard needs.
Product development shall incorporate stakeholder inputs, including from shipyards.
4.6 Premium Structure
Step 6: Premium Charges
Credit risk cover providers may charge premiums to shipyards for the products offered under this
scheme. However, since the corpus is being provided by the Government of India through the
Implementation Agency, premium rates shall be nominal.
Pricing must primarily reflect operational expenses and capacity building costs of the credit risk
cover agencies.
The Implementation Agency will review and approve the premium structures proposed by each
agency and seek prior approval of NSbM to ensure consistency, fairness, and alignment with the
scheme’s objectives.
38DRAFT GUIDELINES FOR SHIPBUILDING RISK COVERAGE
under Shipyard Development Scheme (SBdS)
4.7. Operational Responsibilities
Step 7: Risk Assessment and Claims Management
Credit risk cover agencies shall be responsible for conducting risk assessments and underwriting
policies based on sound methodologies. They must establish transparent and efficient claims
management processes to ensure timely resolution and financial support to shipyards. Agencies
are expected to maintain actuarial discipline and adhere to best practices in insurance
administration.
Credit risk cover agencies will also be responsible for managing payouts under the scheme. They
shall follow industry-standard processes for loss estimation, due diligence, fraud prevention, and
claims verification to ensure integrity and fairness in disbursement.
To ensure accountability, credit risk cover agencies shall be evaluated against defined
performance metrics such as claim settlement turnaround time, accuracy of loss estimation, and
stakeholder satisfaction. These metrics will be reviewed periodically by the Implementation
Agency.
Additionally, the Implementation Agency shall conduct regular audits of the credit risk cover
agencies to verify compliance with scheme guidelines, financial integrity, and operational
standards. Findings from these audits shall be reported to NSbM for necessary action.
4.8 Step 8: Capacity Building
Each credit risk cover provider shall invest in developing sector-specific expertise related to
shipbuilding and maritime risks. This includes training underwriters and claims officers, engaging
with shipyards to raise awareness about available products, and building internal capabilities to
manage complex insurance portfolios.
Each credit risk cover provider shall invest in developing sector-specific expertise related to
shipbuilding and maritime risks. This includes training underwriters and claims officers, engaging
39DRAFT GUIDELINES FOR SHIPBUILDING RISK COVERAGE
under Shipyard Development Scheme (SBdS)
with shipyards to raise awareness about available products, and building internal capabilities to
manage complex insurance portfolios.
Each credit risk cover provider shall invest in developing sector-specific expertise related to
shipbuilding and maritime risks. This includes training underwriters and claims officers, engaging
with shipyards to raise awareness about available products, and building internal capabilities to
manage complex insurance portfolios.
4.9 Monitoring and Oversight
Step 9: Reporting Requirements
Credit risk cover providers shall submit quarterly reports to the Implementation Agency detailing
the number of policies issued, claims processed, fund utilization, and the overall impact of the
credit risk covers on the shipbuilding sector. These reports will be used to assess performance
and guide future fund allocations. The periodicity of the reports will be as decided by the
Implementation Agency. Any irregularities shall be reported to NSbM.
4.10 Step 10: Oversight Mechanism
An Inter-Ministerial Governing Board under NSbM shall oversee the implementation of the credit
risk cover component of SbDS. The Board will review fund utilization, evaluate policy
effectiveness, recommend adjustments to product design or fund allocation, and ensure that the
scheme’s objectives are being met in a timely and efficient manner.
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