Page 170 - Technology Roadmap Transportation

TECHNOLOGY VISION 2035

share in commercial shipbuilding increased and capital intensive industry and apart
from a meagre 0.12% to about 1.3%. The from generating employment, it also
growth though of a very small magnitude on creates growth of several ancillary and
worldwide basis, was significant from Indian support industries. This industry has a
perspective. tremendous multiplier effect because
of good employment potential and its
(c) During this boom there was a dearth of economic impact is significant. All major
available shipbuilding yards worldwide to shipbuilding nations like China, South Korea
fill the appetite of ship owners, who went and Japan have reached top positions with
on ordering for more and more ships. active financial support by way of subsidy
This scarcity of shipbuilding yards provided or reduction in taxes/duties from their
opportunities to Indian commercial respective governments.
shipbuilders to become a manufacturing
option for the international ship owners. At (g) Without incentives from the government by
that time, the Indian commercial shipbuilding way of subsidy or tax benefits, it would be
industry ranked 5 globally, with a market extremely difficult for the Indian shipbuilding
th
share of about 1.3% of world shipbuilding industry to survive. The Indian shipbuilding
capacity. 90% of world shipbuilding capacity industry has been demanding a level playing
was divided between Japan, Korea and China. field, including an “infrastructure status”. The
government should seriously provide financial
(d) However, since 2007, the Indian commercial incentives and other logistics support for
shipbuilding growth has declined promoting shipbuilding industry in the
substantially. After the withdrawal of the country.
subsidy scheme, Indian yards no longer
remained competitive against their Asian 2.2.4 Port Infrastructure
counterparts. India’s share slowly reduced (a) Ports are at the forefront in the logistics
to below 0.2%, which was the share prior chain, and play a vital role in a country’s
to introduction of subsidy scheme for many national trade and overall economic
years. Commercial shipbuilding industry is development.
presently going through one of the toughest
phases nationally as well as internationally, as (b) India’s total merchandise trade has increased
overcapacity in every segment of shipping over three-fold from $252 billion in 2006
has made its survival very tough. to $757 billion in 2015. During the same
period, the volume of cargo handled at ports
(e) The challenges faced by the Indian increased from 636 million tonnes to 1052
commercial shipbuilding industry, besides million tonnes. In 2014-2015, total capacity of
lack of government support, are also lack the country’s ports was 1,247 million tonnes
of system standardisation and system as against which they handled 1052 million
integration processes. Although ISI standard tonnes of cargo[5] .
from Bureau of Indian Standards (BIS)
exists, it is neither diligently enforced nor
sincerely adopted by manufacturers and
suppliers. Lack of standardisation of ancillary
units significantly delays the delivery of India’s total volume of cargo
ships. It takes as short as six months to merchandise trade handled at ports
deliver a vessel by South Korea, while Indian $757 billion 2015 1052 million tonnes
commercial shipbuilding yards take anywhere
between 18 to 60 months, rendering the
sector unattractive for global ship owners to $252 billion 2006 636 million tonnes
place their orders.

(f) The Indian commercial shipbuilding sector (c) Over the past five years, traffic at major
can learn a lot from the agile and robust ports has grown by a compound annual
capabilities of Indian defence shipbuilding growth rate (CAGR) of 4%, while traffic
sector in terms of technology transfer. at non-major ports has grown at a higher
Shipbuilding industry is a highly technical CAGR of 13.7%. This trend has resulted in

168 WATERWAYS