Hanwha Ocean looks to collaborate with Indian shipbuilding companies

Due to a lack of shipbuilding slots in South Korea and the growing demand for new buildings worldwide, Hanwha Ocean Co. Ltd., one of the top shipbuilders in the world, is looking into possible partnerships with Indian yards for investment, cooperation, and knowledge sharing in the construction and repair of ships. This is because the company needs to look at countries like India to offload some of its orders.

During a ten-day visit that ended with a meeting with senior officials in the Ministry of Ports, Shipping, and Waterways on January 14, a high-level delegation from Hanwha Ocean (formerly known as Daewoo Shipbuilding and Marine Engineering Co Ltd) led by Senior Vice President Jin Su Lee visited the Pipavav shipyard, which is operated by Swan Defence and Heavy Industries Ltd (formerly Reliance Naval and Engineering Ltd), state-owned Cochin Shipyard Ltd, Hindustan Shipyard Ltd, and L&T Shipbuilding Ltd.

The largest dock and crane in the world, as well as cutting-edge automated manufacturing facilities, are features of Hanwha Ocean’s shipyard in Geoje. According to a shipbuilding industry executive, Hanwha Ocean is “desperately looking” for shipbuilding facilities in India because of the enormous demand for new ship orders worldwide.

Hanwa Ocean has even indicated to the Indian yards they visited about the shipbuilding orders they are willing to offload to them. Local shipyards say that the key factor that weighs in their favour in the current market is the availability of shipbuilding slots.

The visit by a team from Hanwha Ocean is a sequel to a high-level trip by an Indian delegation led by T K Ramachandran, Secretary, Ministry of Ports, Shipping and Waterways, in late November-early December last year to the shipyards run by Hanwha Ocean, HD Hyundai Heavy Industries Co Ltd, and Samsung Heavy Industries Co Ltd, seeking technical collaboration and joint ventures on the back of a big bang shipbuilding policy that is expected to be cleared by the Cabinet soon. Apart from senior ministry officials, the Indian delegation also included officials from Cochin Shipyard Ltd, Swan Defence and Heavy Industries Ltd, L&T Shipbuilding Ltd, and Shipping Corporation of India Ltd. India holds less than 1 percent of the global shipbuilding market but aims to break into the top 10 ranking by 2030 and the top 5 by 2047.

A fleet owner, whether Indian or foreign, would receive a credit note equal to 40% of the scrap value of a ship being dismantled in an Indian shipbreaking yard under the proposed ship recycling credit note scheme. The credit note would be reimbursable against the cost of building a new vessel at an Indian yard. The Maritime Development Fund (MDF) will be anchored by the government. In addition to other domestic and international financial institutions and non-banking financing firms (NBFCs), it will use the excess cash of state-owned major ports to invest in the MDF.