A new shipbuilding cluster to come up near Kandla

To attract private shipbuilders from across the globe, Deendayal Port Authority (DPA) in Gujarat is looking to lease 2,000 acres in Kutch district to develop a shipbuilding cluster. The target is to annually build 50 very large crude carriers (VLCC) or similar class of sea-going vessels with 3.2 lakh dead weight tonnage (DWT) capacity each.

The Rs 27,000-crore greenfield project is expected to come up in Veera village, near Tuna Tekra. While a private partner will build the shipyard, DPA will make available land with a 1.2-km waterfront on a 30-year lease. It will also provide connectivity and the basic infrastructure needed to operate the facility.

Once completed, the greenfield project will become the 11th shipyard in Gujarat, which already has shipbuilding capacity of over 5.4 lakh DWT, most of which is idling. Usually the shipbuilding capacity of a yard is defined in terms of the number of vessels built and their maximum carrying capacity. In the past decade, six of the biggest shipyards in Gujarat downed shutters, including two belonging to ABG Shipyard — at Magdalla and Dahej, respectively; one belonging to Pipavav Shipyard at Pipavav; and two State-owned facilities — Alcock Ashdown at Bhavnagar and Chanch in Amreli district. 

A decade ago, Pipavav Shipyard (formerly known as Reliance Naval and Engineering Ltd), with 4 lakh DWT capacity, was the biggest shipbuilder in the country. Post slowdown and closure, the unit was recently taken over by Swan Energy, and it resumed operations by refitting a fast patrol vessel of the Indian Coast Guard in December 2024. ABG Shipyard, the second largest private sector facility (1.2 lakh DWT), remains dysfunctional. Among the public sector companies, Alcock Ashdown (15,000 DWT) — the third largest after Cochin Shipyard and Hindustan Shipyard Ltd — continues to idle.

Despite the dormancy, newer projects continue to be announced. DPA plans to build a ship-repair hub at Vadinar in Devbhumi Dwarka district, Gujarat. The Rs 1,700-crore project is being executed in a joint venture with Cochin Shipyard. During the 10th edition of the Vibrant Gujarat summit in January 2024, five proposals to build new shipyards in Gujarat were received from big entities like ArcelorMittal Nippon Steel and Mandovi Drydocks, as also little-known ones like Unicorn Docks and Port Engineers. The agreements with the Gujarat government are for future shipbuilding yards at locations like Hazira, Kutch, Bhavnagar and Amreli.