India’s chief of Naval staff, Admiral Karambir Singh, has come out underscoring the importance of defence shipbuilding in the country.
Speaking at the ‘International Seminar on Nation Building through Shipbuilding organised by FICCI, Admiral Singh said that shipbuilding can contribute immensely to the vision of making India a $5 trillion economy by 2024.
“As India’s shipbuilding industry matures, there is immense potential to forge strategic partnerships and convert India into a hub for defence shipbuilding exports and repairs to friendly foreign countries,” said Admiral Singh.
However, to enable the strategic outcomes, there is a need for the nation to achieve a certain critical mass in indigenous ship production and repair capability, he said.
“While defence shipbuilding plays an important role, we actually need to harness the headroom which is available in sectors such as mercantile marine and coastal shipping to increase capacities and attain our true potential,” Admiral Singh added.
‘‘More than 60% of the naval budget is dedicated to capital expenditure and nearly 70% of this capital budget has been spent on indigenous sourcing amounting to nearly Rs 66,000 crore in the last five years.’’
Dwelling on Indian Navy’s shipbuilding initiatives he said “More than 60% of the naval budget is dedicated to capital expenditure and nearly 70% of this capital budget has been spent on indigenous sourcing amounting to nearly Rs 66,000 crore in the last five years. Since the launch of Make in India in 2014, 80% of the AoNs (Acceptance of Necessity) on cost basis have been awarded to Indian vendors. Of the total 51 ships and submarines on order at various shipyards as on date, 49 are being constructed indigenously,” he noted.
He further added, “Nearly, 90% of ship repair by value is undertaken by Indian vendors and mostly MSMEs, implying that in addition to the capital budget a high proportion of navy’s revenue budget is also being ploughed back into the economy.”
Further, Admiral Singh highlighted how shipbuilding created logistics, spares and project support ecosystems, new capacities within shipyards, employment generation and skill development. He also said time and cost overruns in ship construction created challenges for the navy.
“Studies show that labour employed for a given sum of industrial turnover is one of the highest in shipbuilding industry. Besides, the multiplier effect of one worker employed in a shipyard is about 6.4 in ancillary industries,” he said.
Former chief of the naval staff and Chairman, National Maritime Foundation (NMF) Admiral Sunil Lanba, stated that the country needs a comprehensive policy and support which shall address all three segments – construction, repair and breaking.