India Unveils Ambitious Plan to Break China's Shipbuilding Monopoly

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In a bid to end China's near-monopoly in commercial shipbuilding, the Indian government has launched a ₹4 lakh crore investment plan to manufacture one million twenty-foot equivalent units (TEUs) over the next decade. Union ministers Sarbananda Sonowal and Ashwini Vaishnaw recently signed a pact between five national companies and ports to achieve this goal, which will see the country's 12 major ports and new ones under construction along its 7500-km coastline play a crucial role. The aim is to make India one of the top five shipbuilding nations, with a gross registered tonnage (GRT) of four million tonnes annually by 2047. The country also plans to add 1000 India-made flag carriers by 2036. With over 95% of India's external trade by volume being seaborne, the push to expand maritime infrastructure is part of the government's efforts to secure sea trade and reduce reliance on foreign-made vessels. State oil companies are working with the Shipping Corporation of India to purchase locally made crude tankers, replacing India's aging foreign-chartered fleet. The long-term goal is to have 112 vessels by 2047 at a total estimated cost of ₹85,000 crore. India's shipbuilding sector has the potential to drive growth and development, with each investment creating strong economic impact, boosting jobs 6.4 times and returning 1.8 times the capital. The government has made significant progress in the maritime sector, with the Union Cabinet clearing a ₹69,726 crore investment plan to boost long-term financing, promote greenfield and brownfield shipyard development, and shore up technical capabilities. However, experts say that India's maritime ambitions will require more than just viability gap funding and capital subsidies. It will need to lower domestic manufacturing costs, especially of raw materials like specialised steel, boost private investments, and build a world-class certification ecosystem to capture global markets and take on China. The government is aiming to build a robust ecosystem, not just give subsidies, and a strategy of frontloading public investment to attract the private sector is gradually paying off. The passage of five new laws last year to make ports efficient has also been a significant step towards achieving this goal, which can take ports' share to GDP to over 18%, according to the state-run think-tank Niti Aayog.