Feature 4 | IndIan ShIpbuIldIng
New players in shipbuilding boom
India’s private and public shipyards find a platform to push on with
international customers. A report by Shirish Nadkarni, in Mumbai.
abg managing director Rishi agarwal.
J
ust how much Indian private sector
shipyards have come on in recent
years can be judged by one revealing
statistic – the Gujarat-based ABG Shipyard added value, the yard is also looking at
has one ship being delivered every five setting up its own engine factory.
weeks. At the turn of the millennium, The company’s orderbook at the moment
Indian yards struggled to make a delivery exceeds US$1.7 billion, with bulk carriers
every six months. of different sizes dominating the list and
‘Two years ago, the consolidated offshore vessels like anchor handlers getting
private sector orderbook in India was an honourable mention.
US$400 million; today, the orderbook, Prime amongst the vessels ordered are a
again excluding state-owned and defence dozen 35,000dwt Handysize bulk carriers
yards, is US$4 billion and growing,’ says Engineering giant Larsen & Toubro each for Thailand’s Precious Shipping
ABG Shipyard’s managing director Rishi and Pipavav Shipyard head the list with and Hamburg tramp owner and manager
Agarwal. planned investments of Rs30 billion each, Vogemann, six Supramax double-hull,
A KPMG report on shipbuilding shows followed by Good Earth Maritime with double-bottom bulkers for Mumbai’s
that revenues at the 21 private yards in Rs20 billion; and then the Adani, ABG, Essar Shipping and Logistics, and another
India have nearly quadrupled from Rs10.17 and Bharti groups with Rs15 billion each. five 54,000dwt Supramaxes for Precious
billion (US$257 million) to Rs36.57 billion And more investments by companies with Shipping, the first such vessels to be ordered
(US$926 million) in the last five years. The no previous experience in shipbuilding are by the Bangkok shipowner.
growth rate of private sector yards is far being announced by the day. The Precious Shipping order for five
better than that registered by the seven In addition, the central government is Supramaxes is at a contracted price of
state-owned facilities. looking seriously at building one giant US$184.5 million; and takes the total
At the present level, KPMG places the shipyard each on the eastern and western number of such bulk carriers under
country’s share of the global shipbuilding coasts of the country. construction at the Gujarat-based yard to
industry at a mere 0.3%, while Japan and Companies like South Korea’s STX 12.
South Korea lead the industry with market Shipbuilding, the UK’s McNulty Offshore ‘The image of Indian shipbuilding
shares of 38% and 32%, respectively. Construction, ABG Shipyard, L&T, Essar is improving with each passing day, as
Even China, which really launched Constructions, Shapoorji Pallonji & Co, we show the world that we can produce
its shipbuilding drive only in the 1990s, Goodearth Maritime, Apeejay Shipping, quality and stick to our schedules,’ says Mr
today has a market share of 20%. A cost- and IMC have shown interest in setting Agarwal. ‘There is even more confidence
effective labour force and the availability up a shipbuilding yard on the east coast, in us when shipowners realise that, like
of ancillaries helped China capture a while Bharati Shipyard, STX, and L&T are any top international shipyard, we give
significant share of the world market keen on building a facility on the western replacement guarantees.’
– something that India is only now coastline. Mr Agarwal stresses the fact that,
beginning to replicate. Mr Agarwal firmly believes that the to become successful in shipbuilding,
With trends indicating that the global industry in India has not got as far as it designing ability is a crucial pre-requisite.
shipbuilding boom is likely to continue would like to go, and that its worth should Private Indian yards like ABG now run
for another five years, the major players in be assessed two to three years from now. advanced software to produce detailed
Indian industry expect to take the figure ‘We need to make shipbuilding designs that prove cost-effective to
up to 3% by conservative estimates, and competitive in the long run,’ he says. ‘Of the shipowners.
5% by optimistic ones, by the year 2015. three components that make up successful ‘Of late, I have been seeing a very good
Huge investments, to the tune of Rs185 shipbuilding, ie price, quality, and delivery, move in the ancillary department,’ he says.
billion (US$4.63 billion), have been lined we are already on the ball on the first two, ‘Vendors from all over the world – and they
up by Indian shipbuilders and some and are getting there on the delivery front.’ are big names – are setting up ancillary
corporate houses that have thus far been ABG’s new facility at Dahej, on the outfits in India. This will help India grow
unconnected with shipbuilding. Half these Gujarat coast, is very much on track to as a shipbuilding nation.’
investments are being contributed by just allow commercial production to start The company is now planning to
five private shipyards. in April 2008. In an effort to offer clients construct a second shipbuilding yard on
72 The Naval Architect March 2008
NA Mar 08 - p72+73+75+
77.indd 72 10/03/2008 14:54:35
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