Gautam Adani plans to build ships at India’s largest port, Mundra: Report

Billionaire Gautam Adani is reportedly looking to build ships at his flagship port at Mundra port, the country’s largest, in Gujarat. This comes amid India’s ambitions to become a leading shipbuilder, as mentioned in the Maritime India Vision 2030. 

According to a report in The Economic Times, yards in top shipbuilding nations including China, South Korea and Japan are booked out at least till 2028. This has led global fleet owners to look for alternative options. 

India is currently ranked 20th in the global shipbuilding market, with a marginal share of 0.05 per cent. But India aims to move up to the top 10. 

Adani wants to capitalise on India’s ambitions, and has a Rs 45,000 crore expansion plan for the Mundra port. The port had also received environmental and coastal regulation zone clearance recently. This works in the favour of Adani too, as mentioned in the report, owing to the global shipping industry gradually pivoting towards green ships to meet decarbonisation goals. It is estimated that more than 50,000 vessels would need to be made in the next 30 years to replace the fleets.

While the opportunities present themselves, there are challenges to overcome too. As per the report that quoted KPMG, Indian shipyards need to increase their annual output from 0.072 million gross tonnage (GT) to 0.33 million GT by 2030 and gradually to 11.31 million GT a year by 2047. 

As per the report, Adani has the acreage and environmental approvals to quickly enter the sector. Moreover the SEZ status would help Adani overcome the many tax and financial challenges that face the local shipbuilding industry. These challenges pose disadvantages to the local shipbuilding industry, and India is unable to compete with say, Chinese yards.