By Amit Kumar
When we talk of the Shipbuilding Industry being restrictive to India, we find that it is only a mere 1.3% of the global vessel fleet that Indian Shipbuilding contributes to. It would be an injustice to not mention that the Indian Shipbuilding and Ship repairing Industry is existent since time immemorial. It has its mentions in Arthashastra and various other writings of the ancient Indian folk-lore and maritime history of India traces its history to Indus Valley and Harappan Civilisation. The shipbuilding industry then restricted to coastal territories to carry out and further the existing international trade with the then-existing European empires and South Asian territories.
The Indian Shipbuilding industry was surely one of the most acknowledged panache during ancient times. Colonisation pushed the shipbuilding industry to the backfoot. However, the 17th century saw a bit of a resurgence of the Indian shipbuilding industry but before the 17th century, every step was taken to cripple the industry. Bombay Dock built-in 1735 delivered high niche ships which were later inducted into the Royal Navy. The most famous being HMS Trincomalee, which was later named Foudroyant, was launched on 19 October 1817, carrying 86 guns and displacing 1065 tons. HMS Hindostan in 1795, the frigate Cornwallis in 1800, HMS Camel in 1801, and HMS Ceylon in 1808, and HMS Asia to name a few more. Agitated by India possessing the quality of fighting national with immense shipbuilding, ship repairing, and seafaring ability; the Britishers protested against the use of Indian built ships to carry trade from England on the Thames River.
Subscribe to The Viyug Updates
Get exclusive contents and fresh perspectives on defence, geopolitics, international affairs, public policy, intelligence, strategic studies, and many more delivered to your inbox.
Further, they continued to introduce new rules and regulations. Each was aimed at pulling the use of Indian ships and skyrocketed the influence of British maritime power. So, the Indian Shipbuilding industry possesses global competitiveness for thousands of years. It has been illustrated in recent years that India though holds a percent of the global shipbuilding industry yet it is leaving an impeccable impression and continues to raise the bar.
Colonial rule left India with a mere dozen shipyards around Kolkata and Mumbai. The number rose to around 45 shipyards in the late seventies. For a country like India which is predominantly peninsular geographically surrounded by water on its three sides with an extensive coastline of 14,500 km approximately with over 1200 islands, shipbuilding plays a major role in its economic standing. Unfortunately, India’s shipbuilding capabilities have not kept pace with its economic development, market demand, and human resource potential. The Indian shipbuilding industry is cyclic and has witnessed a period of unprecedented growth from 2003 onwards. As of now, there are 30 shipyards of which 8 are operating under the public sector and others in the private sector.
In 2002, Indian Shipbuilding Industry held 0.1% of the global shipbuilding industry and it increased tenfold by 2011 and the percentage went up to 1%. In comparison, China, Singapore, and nations of the Middle East conquer over a share of almost 45%. (Economic Times of India / International Journal of Innovative Research and Development). Globesreview states that the global shipbuilding industry will rise at an estimated CAGR of 3% during the period 2020-2024 owing to the rising cargo traffic.
When we see the CAGR in terms of the Indian Shipbuilding industry, it is really surprising to jot down that during the period 2002-2011 it showcased a compound annual growth rate of 8%. Further, in the period 2011-2019, the growth of the Indian Shipbuilding industry was estimated at somewhere around 15% and is speculated to grow around 30% CAGR. As of 2018- 2019, India has a fleet strength of 1405 ships making it the 14th largest fleet in the global market. Indian owned ships/vessels carried 7.7% of India’s overseas trade during 2018-19 with a registered gross tonnage of 12.78 million.
Indian share in global exports rose to 1.3% in 2018 as compared to 0.8% in 2003 as per World Trade Statistical Review, 2019. However, the inherently monopolistic nature of naval shipbuilding led to aggressive undervalued bidding for naval projects from an industry desperate for corporate and multinational orders. This, coupled with the burden of high debt, untimely payments, high working capital costs, poor cash flows, poor productivity/ efficiency, and poor project management has resulted in poor performance of shipyards on existing naval orders, resulting in a virtual standstill, in some cases.
Along with the Indian Navy, the Indian Coastguard also plays an influential role in the Indian Shipbuilding industry. Currently, there are 40 ships on order from the Indian Navy and Coast Guard and about 50 ships are in the planning stage for which orders will be given shortly to public/private sector shipyards. India’s defence base remains limited which further limits the standardization of the shipbuilding sector. The shipbuilding industry is of great strategic and economic significance and can contribute significantly to the country’s manufacturing sector and be a key enabler for achieving the target of an economic superpower.
(The views and opinions expressed are those of the author)
Author’s Profile
Mr. Amit Kumar is the Founder CEO & Editor in Chief of the Sea and Coast Magazine. India’s no:1 maritime magazine.
Share this article with your friends and colleagues on Twitter
Read this article titled “Ship Building Industry in India: A Detailed Perspective of its Immense Capabilities”.
Tweet
The Viyug 