Andhra Pradesh has formally cleared the decks for a major defence and warship building facility at Machilipatnam, Economic Times reported.

The project will be spearheaded by Goa Shipyard Limited, a defence public sector undertaking, which will invest ₹8,000 crores in the new unit. This marks the first time the company will step outside its traditional base in Goa to establish a facility elsewhere.

The State Investment Promotion Committee approved the project at its meeting on Monday. Sources confirmed that the company will be allotted 400 acres of land in two phases, with 198 acres in the first and 195 acres in the second.

The scale of the project reflects the growing importance of Andhra Pradesh’s coastline in India’s maritime and defence expansion strategy.

Company estimates suggest that the facility will generate 3,000 direct jobs and 5,000 indirect jobs. Goa Shipyard has been exploring alternative locations on the east coast to expand beyond Goa, primarily due to the impact of monsoons.

Shipbuilding is largely an open-air activity, and operations in Goa are disrupted when monsoons arrive. A senior official explained that the east coast offers a different monsoon cycle, allowing uninterrupted shipbuilding activity.

The preparatory phase will begin next month, including environmental impact assessments and preparation of a detailed project report. Machinery installation is scheduled to start in October next year, with trial production expected by January 2028.

Commercial production for the first phase is targeted for May 2028, while the second phase is slated to commence in December 2028. The facility will be capable of building ships with a length of 120 metres and a draught exceeding six metres.

Goa Shipyard initiated discussions with the Andhra Pradesh government in early 2025. A memorandum of understanding was signed at the Confederation of Indian Industry partnership summit in Visakhapatnam in November 2025. Initially, the planned investment was pegged at ₹1,500 crores, but the scale has since expanded to ₹8,000 crores, underscoring the strategic importance of the project.

The new facility will significantly strengthen India’s warship building capacity, diversify Goa Shipyard’s operations, and enhance the country’s maritime defence infrastructure.

It also reflects the broader national push under Aatmanirbhar Bharat to expand indigenous defence manufacturing and reduce reliance on foreign shipyards.

The project is expected to catalyse industrial growth in Andhra Pradesh, attract ancillary industries, and reinforce the state’s position as a rising maritime hub.

Agencies