Reference Article: The Hindu

UPSC Relevance:
– GS Paper II: Government Policies and Interventions for Development
– GS Paper III: Infrastructure – Ports, Shipping, and Waterways; Economic Growth and Industrial Policy
– Essay Paper: India’s Economic Strategy and Maritime Vision

The India Maritime Week, inaugurated by Prime Minister Narendra Modi, marked a significant shift in how the Indian government views shipping — not merely as a commercial activity but as a sector with deep strategic importance. The event symbolised an overdue recognition that maritime capability is central to national resilience, especially in an era of global disruptions, trade wars, and geopolitical realignments.

Historically, India’s shipping industry had suffered a long period of decline under the policy environment of liberalisation, privatisation, and globalisation (LPG). These reforms, while modernising several sectors, weakened state support for domestic shipping. The focus shifted from building national capacity to merely training Indian seafarers for foreign employment, sidelining the goal of maritime self-reliance.

Decline and Strategic Realisation

• The Shipping Corporation of India (SCI), once a globally competitive public sector enterprise, lost its strategic edge as policies granting it preferential rights — such as first claim to transport India’s oil — were dismantled to promote “competition.”
• The proposed privatisation of SCI nearly went through before being paused, as policymakers began to appreciate the dangers of excessive dependence on foreign tonnage.
• The COVID-19 pandemic proved to be a wake-up call. When global shipping routes were disrupted, India’s overreliance on foreign-owned vessels left it with limited leverage to ensure the continuity of its own trade and supply chains.
• This experience triggered a strategic rethink — recognising that shipping is both a commercial enabler and a national security asset, vital during crises such as wars, blockades, or global supply chain shocks.

In response, the government has begun revitalising SCI’s fleet and formulating policies to enhance domestic control over maritime logistics and trade.

Government Initiatives and Port Modernisation

A substantial portion of the investment commitments made during Maritime Week focused on port development, aligning with India’s broader logistics and infrastructure goals.

• The landlord port model has been central to this growth. Under this model, port authorities retain ownership of the land and basic infrastructure while private and foreign operators manage terminals, sharing revenues with the government.
• This has increased the financial strength of major ports, enabling them to take on large-scale projects such as:
  • Transshipment hubs in the Andaman & Nicobar Islands (Chennai and Kolkata ports)
  • Sagarmala projects to enhance coastal connectivity and industrial linkages
  • Seafarer training programmes to maintain India’s position as a global leader in maritime manpower

The policy push also encourages foreign shipping companies to register their vessels in India through local subsidiaries, which would:

• Provide the Indian government strategic control in emergencies or national interest situations
• Boost ancillary sectors such as marine insurance, ship repair, and logistics services

Challenges and Gaps

Despite this renewed focus, progress in Indian merchant shipbuilding remains minimal. The absence of a strong indigenous shipbuilding industry continues to be a critical gap in India’s maritime ecosystem.

• The ability to design and build modern vessels — such as LNG carriers or green-fuel ships — would demonstrate true industrial and technological capability.
• Indian shipyards, despite having the capacity for repair and retrofitting, lag behind in high-value construction projects due to inadequate investment, lack of skilled design expertise, and inconsistent policy support.

Until Indian shipyards can produce state-of-the-art vessels at competitive costs, the country will remain dependent on foreign manufacturers, undermining its maritime autonomy.

Analytical Insights

1. Strategic Autonomy through Shipping:
   A strong domestic shipping sector enhances economic sovereignty and geopolitical leverage, reducing dependence on foreign fleets during crises.
2. Industrial Linkages and Economic Growth:
   Reviving shipbuilding can drive heavy industry, metallurgy, and engineering innovation, contributing to the “Make in India” and “Aatmanirbhar Bharat” initiatives.
3. Balancing Liberalisation and Security:
   The experience since the 1990s shows that excessive reliance on market-driven policies can erode critical infrastructure in strategic sectors. A hybrid model balancing competitiveness with national interest is essential.
4. Environmental Transition:
   As global shipping moves toward decarbonisation, India’s investment in green and LNG-powered vessels can position it as a leader in sustainable maritime technology.

Conclusion

The India Maritime Week marks a turning point in India’s approach to shipping — from viewing it as a profit-driven business to recognising it as a pillar of national security and industrial strength. Strengthening public sector participation, expanding shipbuilding capacity, and strategically regulating foreign operators can help India achieve maritime self-reliance.

India’s long-term vision should focus on transforming its ports into global logistics hubs, ships into symbols of industrial pride, and its maritime policy into a cornerstone of economic and strategic power. The day Indian shipyards launch world-class LNG and green-energy vessels will mark the true revival of India’s maritime destiny.

UPSC Mains Practice Question:

Discuss how India’s maritime strategy is evolving from a commercial to a strategic focus. What policy measures are needed to strengthen India’s shipping and shipbuilding industries in this context?