Billionaire Gautam Adani Eyes Shipbuilding Expansion at Mundra Port

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Billionaire Gautam Adani Eyes Shipbuilding Expansion at Mundra Port

Billionaire Gautam Adani is reportedly exploring the possibility of establishing a shipbuilding business at Mundra port, India's largest port located in Gujarat. This move is in line with India's aspirations to enhance its shipbuilding capabilities as outlined in the Maritime India Vision 2030. The decision comes at a time when shipyards in leading shipbuilding nations like China, South Korea, and Japan are fully booked until 2028, prompting global fleet owners to seek alternative options for their shipbuilding needs.

Currently ranked 20th in the global shipbuilding market with a mere 0.05% share, India is striving to elevate its position to the top 10. Adani is keen on leveraging India's ambitions in shipbuilding, unveiling a substantial Rs 45,000 crore expansion blueprint for the Mundra port. With the recent clearances for environmental and coastal regulation zones, Adani's plan gains momentum, especially since the global shipping industry is gradually shifting towards eco-friendly vessels to meet decarbonization objectives. Projections indicate a requirement of over 50,000 ships within the next three decades to replace existing fleets, demonstrating a substantial market potential.

While opportunities abound, there are challenges to tackle in order to realize India's shipbuilding goals. Reports referencing KPMG highlight the necessity for Indian shipyards to significantly increase their annual output from 0.072 million gross tonnage (GT) to 0.33 million GT by 2030 and eventually to 11.31 million GT annually by 2047. Adani's strategic advantage lies in possessing the necessary acreage and green approvals to swiftly venture into shipbuilding. Additionally, the SEZ (Special Economic Zone) status could offer Adani tax benefits and financial advantages, providing a competitive edge over local shipbuilding competitors facing tax and financial hurdles. Despite these advantages, India faces challenges in competing with established shipyards like those in China, underscoring the obstacles hindering the growth of the local shipbuilding industry.