Union Budget 2026: ₹10,000 crore anchor for container manufacturing

Budget 2026 unveils a Rs 10,000 crore container manufacturing scheme, adds 20 new waterways and tax reforms, with global players like MSC, Maersk and Adani showing interest in India-made containers

Finance Minister Nirmala Sitharaman on Sunday announced a container manufacturing assistance scheme with an allocation of ₹10,000 crore in the Union Budget, along with 20 new waterways, and a scheme to promote coastal shipping.

 

The container scheme will enable a manufacturing capacity of 1 million twenty-foot equivalent units (TEUs) and mobilise an investment of close to ₹1.1 trillion.  The ministry said that major global players such as MSC, Maersk/Artsons (TATA), Adani and JM Baxi, have expressed interest in either participating or procuring containers manufactured in India. 

 

India currently imports around 2 million empty containers a year. 

 

Based on broad contours, the government is looking at bridging a cost differential of nearly $400 per container, said a senior official in the know. 

 

The government wants to bridge the cost differential between an India-made container and the prevailing market rates, and it will require state support both on the input costs of setting up facilities and output-linked incentives.

 

Shipping secretary Vijay Kumar said the government will also sign an agreement to operationalise the Bharat Container Shipping Line (BCSL) this week, which will need 1 million TEUs itself.  

 

BCSL was launched by Prime Minister Narendra Modi in October last year as India’s new national container carrier, with financial backing from the Shipping Corporation of India and the Container Corporation of India. It will start operations with around 51 vessels. 

 

Moreover, the tax reforms announced by the finance minister in the Budget will have major encouraging implications for the sector.

 

The tax deduction period for units in IFSC and Offshore Banking Units (OBUs) is extended from 10 to 20 consecutive years within a 25-year span.

 

After this deduction period, business income of these units will be taxed at 15 per cent. This will enable a greater number of ship owners to own & flag their vessels via GIFT IFSCA. Moreover, the sunset clause for Customs duty exemption on import of small vessels has been extended by 2 years till March 2028, while it has been removed for large vessels.The 20 new waterways announced by Sitharaman will be operationalised over the next five years — this will take the number of operational waterways to 52. A ship repair ecosystem for inland waterways will also be set up in Varanasi and Patna.

 

The finance minister also announced a coastal cargo promotion scheme to increase the share of coastal shipping and inland waterways to 12 per cent of the national modal share by 2047.