Andhra Pradesh has moved swiftly to leverage a key proposal from the Union Budget 2026–27 aimed at strengthening India’s maritime infrastructure by establishing dedicated ship-building and repair clusters. The state government has begun proactive planning to develop a large-scale cluster in the Duggarajapatnam area, tapping into its long coastline and strategic port network to position itself as a hub for maritime manufacturing and services. This initiative aligns with the Union Budget’s emphasis on cluster-based infrastructure development aimed at boosting industrial competitiveness and employment generation.
Capitalising on its natural advantages, Andhra Pradesh already hosts existing ship-building and repair facilities near Kakinada Port, and the new plans seek to expand this capacity significantly. A Special Purpose Vehicle (SPV) has been formed under a public-private partnership (PPP) model to develop the Duggarajapatnam cluster over approximately 2,000 acres, which is expected to attract further investment from shipbuilders and related industries. Officials and industry stakeholders believe the cluster could catalyse broad economic activity, creating thousands of direct and indirect jobs in coastal districts and enhancing the state’s role in India’s maritime ecosystem.
The momentum for developing the cluster has been boosted by the Union Budget’s broader focus on infrastructure and regional development. While the Budget outlined support for strategic sectors and numbered priorities for coastal and logistics infrastructure, the ship-building and repair cluster initiative aligns with national efforts to reduce reliance on foreign manufacturing and build domestic industrial capabilities. Experts see this as a timely opportunity for Andhra Pradesh to integrate inland waterways, deep-water ports and export-oriented activities, complementing other initiatives like rare earth corridors and industrial clusters in the Budget.
With major ports such as Gangavaram, Visakhapatnam Deep Water Port, Machilipatnam and Krishnapatnam within its coastal belt, Andhra Pradesh boasts one of India’s most favourable geographies for maritime industry growth. The development of the ship-building and repair cluster is expected to synergise with ongoing port infrastructure upgrades and captivate interest from global players seeking a foothold in the Indian marine manufacturing market. Moreover, such clusters have the potential to strengthen logistical linkages, enhance export competitiveness, and attract ancillary industries.
State policymakers have underscored the strategic economic benefits of the project, signalling strong support for infrastructure readiness and regulatory facilitation. Listening to industry feedback and building robust supply chains will be critical as Andhra Pradesh strives to turn budgetary frameworks into tangible economic outcomes. If successful, this maritime cluster could set a template for coastal industrial development that other states may emulate in the coming years.
