Swan Defence and Garden Reach Shipyards Partner as Orders Surge

 

With India vying for a larger global shipbuilding market, two of the country’s major shipyards have partnered to maximize output. This week, Swan Defense and Heavy Industries Limited, the company that runs Pipavav Shipyard in Gujarat, signed an MoU with the state-run Garden Reach Shipbuilders & Engineering Ltd (GRSE). The partnership will see the two shipyards jointly pursue opportunities in the construction of commercial vessels and offshore structures.  

Pipavav has the largest dry dock in India, measuring 662 meters by 65 meters, and a working space spanning 500 acres. Unfortunately, even with a big dock capacity, it has not attracted substantial orders after resuming operations in December.

On the other hand, the Ministry of Defense- controlled GRSE has built a legacy in naval construction. However, it is looking to expand into the commercial shipbuilding segment. This has started to take shape with GRSE last year getting an order for four multi-purpose cargo vessels from the German shipping company Carsten Rehder.

According to industry analysts, the MoU could see GRSE utilize Pipavav’s facilities, especially in executing its commercial orders. On the defense side, GRSE has seen a surge in naval shipbuilding contracts. Currently, the shipyard has orders for about 40 naval platforms. Based on this rising demand, GRSE in a recent earnings call said that it has increased its annual capacity to 24 ships this year, with plans for a greenfield facility in the next 3-5 years.

Meanwhile, GRSE this week announced receiving a letter of award (LoA) worth over $50 million from the government of India. This will go into the construction and delivery of two coastal research vessels for the Geological Survey of India. The projected is expected to be complete within 36 months from the signing of the contract.