India's Nuclear Ambition vs. Commercial Shipbuilding Hurdles: Unpacking the Country's Maritime Development Paradox

India's Ambitious Shipbuilding Plans Face Reality Check

India's recent commissioning of INS Aridhman, a nuclear-powered ballistic missile submarine, marks a significant milestone in the country's naval capabilities. However, this achievement highlights a stark contrast in India's commercial shipbuilding capacity, which remains limited despite its growing naval prowess. While India has built commercial ships, its global presence in this segment is dwarfed by major naval projects like the INS Vikrant aircraft carrier.

According to recent statistics, India accounts for less than 1% of the global commercial shipbuilding market. China and South Korea together dominate nearly 80% of the market, with India owning just over 1,500 ships, around 1.2% of the global fleet. The country also spends an estimated Rs 90 billion annually on freight, largely carried by foreign vessels, as per credit rating agency ICRA.

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India's inability to compete in the commercial shipbuilding sector can be attributed to economic factors rather than engineering limitations. The country's focus on building complex warships, such as the 45,000-tonne aircraft carrier, is a stark contrast to its struggles in constructing standard cargo ships.

To address this issue, the Indian government has rolled out policy reforms aimed at strengthening the sector. The package includes multiple schemes aimed at reducing import dependence and cutting freight-related dollar outflows. These initiatives aim to promote India's shipbuilding industry and increase its global presence in the commercial shipbuilding market.