The Future of Shipbuilding in India: Technological Innovations and Market Trends

The Indus Valley civilisation, which built early ships and traded internationally, is the source of India's rich maritime history. The shipbuilding sector now contributes significantly to employment, exports, and national defence, and to India's economic and strategic development. India can become a global leader in shipbuilding owing to its extensive maritime trade network and more than 7,500 kilometres of coastline.

Shipbuilding is a capital-intensive industry requiring advanced technology, skilled labour and strong policy support. It creates jobs in sectors such as electronics, steel, engineering, and maritime equipment. A robust local shipbuilding industry can improve India's Blue Economy, a major focus area under the "Make in India" and "Atmanirbhar Bharat" programs. It improves the country's trade balance and reduces dependency on imports.

Strategically, India's defence capability and marine security depend heavily on shipbuilding. India is investing in naval modernisation and building aircraft carriers, submarines, and warships to bolster its naval fleet considering the changing geopolitical environment in the Indo-Pacific region. India wants to secure its maritime trade routes and maintain a strong presence in regional waterways, and this is in line with that goal.

Through the Sagarmala Initiative, which aims to modernise ports, increase shipbuilding capacities, and enhance logistical efficiency, India's shipbuilding sector promotes the development of coastal infrastructure. Despite these advantages, the sector still faces issues such as outdated infrastructure, restricted access to international markets, expensive capital, and a fierce rivalry with South Korea, Japan and China.

Evolution of shipbuilding in India

India has a long history of shipbuilding. Gujarat, Maharashtra and Bengal were known for building massive wooden ships for trade and combat. Indian shipbuilders created cutting-edge vessels that were in high demand in the Middle Ages. However, rules favouring European manufacturers hindered India's capacity to grow its marine industry during British colonial control, which led to a downturn in indigenous shipbuilding.

India established significant state-owned shipyards because of prioritising naval and defence shipbuilding after achieving independence. India made great progress in producing navy ships over the years, but commercial shipbuilding has found it difficult to stay up because of financial and technological limitations. However, with increasing government support, foreign investments, and advancements in technology, India is now working toward revitalising its shipbuilding sector to compete on a global scale.

Overview of the Indian shipbuilding industry

India's shipbuilding business is a vital industry with enormous potential for job creation, economic expansion, and national security. With more than 200 minor ports, 12 major ports, and a 7,500-kilometer coastline, India has a robust marine base that encourages homegrown shipbuilding. Despite these benefits, the nation's share of the global shipbuilding market is less than 1%, far less than that of South Korea (25%), Japan (18%), and China (47%). While these countries have established sophisticated shipbuilding ecosystems with robust financial incentives and state-of-the-art equipment, India is still working to modernise its shipyards, build up its own skills, and become globally competitive.

Source: Straits Research, F- Forecasted

The value of the global shipbuilding market was estimated at US$ 150.42 billion in 2024 and is projected to increase at a compound annual growth rate (CAGR) of 3.43% from US$ 155.58 billion in 2025 to US$ 203.76 billion in 2033.

The foundation of international trade is marine transportation, and trade expansion has been a defining features of the global economy in recent decades. Naval commerce has had a major impact on the ship market. Many nations have seen economic growth driven by the opening of new markets and the extension of supply chains made possible by maritime transportation. Approximately 90% of all goods is said to be delivered by sea. Consequently, countries that depend heavily on ships increase the demand for shipbuilding.

South Korea, Japan, and China accounted for ~85% of all shipbuilding activity. Cargo ships are the most common marine vessels used in trade. Global import and export volumes have increased because of the growing need for maritime transportation. Opportunities for international trade in goods are growing as globalisation becomes rooted in many economies, providing a range of commodities at different price points. Throughout the anticipated period, the demand for shipbuilding will likely be driven by the growing international maritime traffic.

Source: Finextra Research, F- Forecasted

The Indian shipbuilding sector is expanding at an exponential rate. According to Finextra Research, it was valued at US$ 90 million in 2022 and is expected to grow at an incredible 60% CAGR to US$ 8,120 million by 2033. Government support, an ideal location, labour cost benefits, and an emphasis on specialised markets like ferries and offshore support vessels are all contributing to this rise. As per the Ministry of Ports, if Indian shipyards "adequately target" India's shipping business, there might be an opportunity of over US$ 237 billion by 2047.

Leading shipyards and their capabilities

The Indian shipbuilding sector is broadly categorised into public- and private-sector shipyards. While private companies serve commercial vessels, offshore support vessels, and ship repairs, public-sector shipyards largely concentrate on defence and naval vessels, supporting India's maritime security. Due to technical advancements and limited access to reasonably priced finance, the capital-intensive industry—which calls for upscale production facilities, specialised maritime equipment, and expert labour—remains substantially under-used. However, the industry is set to undergo change, particularly in defence and sustainable shipbuilding, thanks to growing government support and new programs under "Make in India" and "Atmanirbhar Bharat."

Public sector shipyards

India’s public-sector shipyards primarily cater to defence but have recently expanded into commercial shipbuilding. Some key shipyards include:

• Cochin Shipyard Limited (CSL):India’s largest shipyard, known for building commercial vessels, defence ships, and the INS Vikrant, India’s first indigenous aircraft carrier.
• Mazagaon Dock Shipbuilders Limited (MDL): Specialises in constructing submarines, warships, and offshore patrol vessels for the Indian Navy.
• Garden Reach Shipbuilders & Engineers (GRSE): Focuses on frigates, corvettes, and patrol vessels, and has also built export ships for international clients.
• Goa Shipyard Limited (GSL): Primarily constructs offshore patrol vessels (OPVs), fast patrol boats, and interceptor boats for defence forces.
• Hindustan Shipyard Limited (HSL): Handles naval support vessels, submarines, and ship repair services.

Private sector shipyards

The private sector has been actively involved in commercial shipbuilding, offshore vessels, and naval contracts. Key private players include:

• Larsen & Toubro (L&T Shipbuilding): Specialises in high-speed interceptors, defence vessels, and offshore support ships.
• Reliance Naval and Engineering Limited (RNEL): Engages in naval and commercial shipbuilding, although financial issues have impacted operations.
• Shoft Shipyard and ABG Shipyard: Focus on small vessels, tugboats and support ships.

Types of vessels built in India

Indian shipyards have built a variety of ships for the offshore, commercial, and defence sectors. Advanced warships including frigates, corvettes, destroyers, and submarines—built with domestic steel and cutting-edge combat systems—are needed by the Indian Navy and Coast Guard. In contrast, the commercial sector focuses on building roll-on/roll-off (RoRo) vessels, oil tankers, bulk carriers, and container ships. With India's expanding oil and gas development activity in deep-sea regions, there is an increased demand for dredgers, anchor-handling tugs, and offshore support vessels (OSVs).

To meet the IMO 2030 and 2050 decarbonisation targets, India is progressively moving towards green shipbuilding, concentrating on LNG-powered ships and hybrid propulsion systems. India can establish itself as a pioneer in environmentally friendly marine solutions by emphasising on solar-powered ferries, hydrogen fuel-cell technology, and zero-emission ships.

Conclusion

India's shipbuilding sector is at a turning point and has the potential to grow into a major force in the world's maritime economy. Proactive government initiatives like the Sagarmala Program, Make in India, and the Shipbuilding Financial Assistance Policy have impressively advanced commercial and defence shipbuilding. Productivity and operational efficiency have been further improved by robotic automation, AI-driven design optimisation and digital twin technologies. Furthermore, India is positioned as a leader in sustainable marine solutions because to the transition to green shipbuilding, which includes the use of electric ferries, hydrogen fuel cells, and LNG-powered boats.

Soon, the industry's expansion will likely be fuelled by sustained investments in modernising infrastructure, building intelligent shipyards, and creating strong domestic manufacturing ecosystems. To maintain a competitive edge, it will be essential to promote research and innovation, encourage foreign direct investment (FDI) , and strengthen partnerships between public and private organisations. Enhancing marine training facilities and emphasising skill development would also guarantee a highly qualified workforce that can propel technical breakthroughs. India can become a global centre for shipbuilding and ship repair by taking advantage of these opportunities and resolving current issues, thus boosting its economic development and marine security.