Context: The Minister for Ports, Shipping, and Waterways is spearheading a new Shipbuilding Mission aimed at establishing a strong global presence in the shipbuilding industry by 2047. 

• This initiative is part of the broader Make in India campaign, which seeks to enhance domestic manufacturing capabilities.

Overview of the Shipbuilding Industry

• Shipbuilding involves activities related to the design, construction, maintenance, and repair of various types of vessels used in transportation, defence, and commerce.

Shipyards

• Shipyards are specialised facilities responsible for assembling ships and managing large-scale maritime construction projects.

Global Market Insights

• In 2023, the global market for shipbuilding was valued at approximately USD 207.15 billion, and it is projected to grow to USD 220.52 billion by 2024.

Key Shipbuilding Nations

• The main contributors to the global shipbuilding industry include China, South Korea, Japan, India, Germany, and the United States.

• China, South Korea, and Japan account for a combined 85% of the global market share.

India’s Contribution:

• India represents 0.06% of the global shipbuilding industry.

• The country ranks 12th globally, with shipbuilding exports valued at USD 1.12 billion, while China leads with exports worth USD 25 billion.

• In 2022, the value of India’s shipbuilding sector was USD 90 million, with projections indicating growth to USD 8.12 billion by 2033.

Future Potential

• The Indian shipbuilding sector has the potential to unlock opportunities worth over USD 237 billion by 2047, aided by government support, favourable geographic location, and cost-effective labour.

Leading Indian Shipbuilding Companies

• Mazagon Dock Limited (MDL):

• A key player in constructing warships for the Indian Navy and Coast Guard.

• Cochin Shipyard Limited (CSL):

• Specialises in the production of offshore vessels, oil tankers, and aircraft carriers.

• CSL is India’s largest shipbuilder and operates the country’s most extensive ship-repair facilities.

• Adani Group’s Shipbuilding Initiative:

• In 2024, the Adani Group announced a large-scale shipbuilding project at Mundra Port in Gujarat, with a proposed investment of Rs 45,000 crore.

• The initiative aims to establish India as a major player in global shipbuilding, with a target market valuation of USD 62 billion by 2047.

Key Features of the Proposed Shipbuilding Mission

• Goal for 2047: The government aims to position India as a leading player in the shipbuilding industry and establish the country as a global maritime hub by 2047.

• Current Global Market Share: India currently holds less than 1% of the global shipbuilding market.

• Twelve Key Focus Areas: The mission has outlined twelve focus areas for development, including financing, insurance, ownership, leasing, chartering, shipbuilding, repair, recycling, flagging, registration, operations, technical management, staffing, crewing, and arbitration.

• Shipbuilding Parks: Plans are in place to develop mega shipbuilding parks on both the eastern and western coasts of India. South Korea and Japan have been invited to explore foreign investment opportunities.

• Locations: These shipbuilding parks will be located in states like Maharashtra, Kerala, Andhra Pradesh, Odisha, and Gujarat.

• Economic Impact: Since 95% of India’s trade relies on foreign vessels, the initiative aims to reduce this dependency and retain the estimated annual outflow of USD 110 billion.

• Maritime Development Fund: The government plans to create a Maritime Development Fund with a corpus of Rs 25,000 crore to provide long-term financing for maritime initiatives, potentially modeled after the National Bank for Financing Infrastructure and Development (NaBFID).

Upcoming Missions

• Two additional missions are planned

• Cruise India Mission: Focused on upgrading port infrastructure and building exclusive cruise terminals to accommodate large vessels.

• Ship Repair and Recycling Mission: Aiming to develop India as a repair and recycling hub for ships.

• Major Repair Hubs: Cities like Kochi, Mumbai, Chennai, Kolkata, and Vadinar (in Gujarat) will be further developed into major repair centers.

• Centre of Excellence: A Centre of Excellence in Shipbuilding and Repair will be established to foster innovation in these sectors.

• Free Trade Depot: Customs exemptions for imported materials used in ship repairs will be provided through Free Trade Depots at shipyards.

• Maritime Dispute Resolution: The International Maritime Dispute Resolution Centre (IIMDRC) has been launched to resolve maritime disputes domestically, reducing dependence on hubs like Dubai and Singapore. The IIMDRC will offer merit-based, industry-governed solutions, positioning India as a hub for maritime arbitration.

• Third-Party Maritime Insurance: A proposal for establishing the India Club is being considered to provide third-party maritime insurance for coastal and inland waterways, protecting against international sanctions and economic pressures.

Recent Developments in India’s Maritime Sector

• Mega Ports Expansion: India has ambitious plans for establishing mega ports across the country, including the recently approved Rs 76,220 crore Vadhavan port in Maharashtra.

• Transhipment Port: A mega port is planned at Galathea Bay in the Andaman & Nicobar Islands, designed to handle transhipment cargo currently managed outside of India.

• Container Capacity Growth: The ministry projects that India’s container handling capacity will grow to 40 million TEUs (twenty-foot equivalent units) over the next five years.

• Jawaharlal Nehru Port: India’s Jawaharlal Nehru Port aims to increase its capacity from 6.6 million TEUs to 10 million TEUs, becoming the first Indian port to achieve this capacity milestone.

• Land Allotment for Hydrogen Manufacturing Hubs: Around 3,900 acres of land has been allocated to the Deendayal Port Authority (DPA) in Kandla and VO Chidambaranar Port Trust to establish hydrogen manufacturing hubs.

• International Port Operations: India Ports Global Ltd (IPGL) has taken over operations at international ports in Sri Lanka, Myanmar, and Bangladesh.

• Chabahar Port Contract: India has successfully operationalized its contract for Chabahar Port.

• India-Middle East-Europe Corridor: The 4,800 km India-Middle East-Europe Economic Corridor (IMEC) will connect Indian ports with Saudi Arabia, the United Arab Emirates (UAE), and Europe.

• MAITRI Interface: The Master Application for International Trade and Regulatory Interface (MAITRI) integrates India’s operational trade portals with those of the UAE, streamlining cross-border processes.

• Virtual Trade Corridor (VTC): This platform, designed for secure and efficient trade data exchange, forms the backbone of the IMEC corridor.