HD Hyundai Moves Forward with Plans to Establish an Indian Shipbuilder
South Korea’s largest shipbuilding group, HD Hyundai, is continuing to take steps toward developing a large shipbuilding yard in India. The company is exploring multiple opportunities to support the Indian government initiative to make the country an international leader in shipbuilding.
HD Hyundai reports it has signed a strategic partnership with the Tamil Nadu state government in southeast India on the Bay of Bengal regarding the establishment of a new shipyard. They plan to work together to explore sites for the development and operation of the shipyard.
Media reports suggest Hyundai plans to invest as much as $2 billion in the development of the new facility. It would likely have two to three building berths and take advantage of planned investments in the region’s port infrastructure. Hyundai highlights that the state is well-suited to shipbuilding and that it has a similar climate to Ulsan, South Korea, where its operations are based. They also note that other Korean companies, including Hyundai Motor Company and Samsung Electronics, already have operations in the region.
The move comes as the state-owned VO Chidambaranar Port Authority, also in the Tamil Nadu state, announced that it was set to move forward with a tender for a new shipyard. It plans to offer a large piece of land near Thoothukudi for the site of the shipyard development. The successful bidder will receive a 30-year concession.
Tamil Nadu is one of five areas India selected as potential sites for new shipyards. The government’s plan calls for expanding existing yards as well as developing greenfield projects. The government’s plan calls for India to be in the top five of worldwide shipbuilding countries.
India had been a leading shipbuilding country in the top 10 worldwide till the early 2000s, but today has slipped to number 16. Reports highlight that India’s merchant fleet is aging, with nearly half over 20 years of service. India has already introduced regulations designed to slow the aging of the fleet by barring registry of older ships, while the government recently outlined plans for a $3 billion development fund to support shipbuilding and Indian-flagged shipping.
India’s plan for the shipping industry calls for expanding its merchant fleet from 1,500 to 2,500 ships in part by increasing the shipbuilding capacity to 500,000 gross tons. Shipping Corporation of India recently said it would spend $2.3 billion by 2030 as part of a new construction plan. The government said the tanker sector should grow with a goal of transporting 69 percent on India’s domestic fleet.
Hyundai also announced an expanded relationship with the state-owned company BEML (Bharat Earth Movers) to expand the ship crane construction business. They aim to gradually build port crane manufacturing capabilities in India and to supply jig and gallath cranes to the shipyards. HD Hyundai’s Samho yard previously delivered in August a 600-ton Galliath crane to the Cochin Shipyard.
In July, HD Hyundai and Cochin Shipyard also signed an MOU designed to promote cooperation in the shipbuilding sector. The companies said they would collaborate on ship design and procurement support, and Hyundai would use its expertise to aid with productivity enhancements, and training and development for personnel.
India’s plans to develop its shipbuilding capabilities have drawn wide interest. Russia has also expressed interest in working with India to develop the industry.