How Mazagon dock seeks to make a mark in merchant shipbuilding

The 251-year old Mazagon dockyard boasts of an enviable skill-set it has cultivated over the years. Though known as a maker of defence ships, its management cites its record in merchant shipbuilding as well. The company’s management has come up with a plan to pivot towards the highly competitive world of commercial shipbuilding. The leadership believes technology transfer alone will not help in India’s endeavour to build shipbuilding strength. Operational control may need to be given to strategic partners from South Korea or Japan to help India leapfrog. A Mumbai landmark The island city of Mumbai’s west coast is characterised by scenic waterfronts, from Marine Drive to Worli Promenade to Haji Ali. On the less scenic east coast are two strategically important docks which have been in operation for over 250 years now. Towards the southern tip of the city is the Naval Dockyard, a military facility managed by the Indian Navy. A few kilometres up north is Mazagon Dock Private Limited, a facility primarily known for building of defence ships. As one passes from the Eastern Freeway, the logo of MDL is seen on the gigantic, 300 tonne Goliath Crane, an imposing yellow structure. Surrounded by highly dense population clusters, Mazagon dock employs over 6,000 workers. They build warships, submarines, merchant ships of up to 40,000 deadweight tonnes. Mazagon Dock Shipbuilders Limited was a small dry dock when it was constructed in 1774. It was incorporated as a Private Limited Company in 1934. In 1960, it was taken over by the Government of India. Over the years, it has grown from a single unit, small ship repair company into a multi-unit and multi-product company, with a significant rise in production, use of modern technology and sophistication of products. The company’s current portfolio of designs spans a wide range of products for both domestic and overseas clients. Aligning with the government’s Maritime Amrit Kaal Vision 2047 and Maritime India Vision 2030, MDL is now looking to manufacture commercial and large ships with up to 1 lakh tonne DWT (Deadweight Tonnage), which would translate to 1 lakh tonne of cargo carrying capacity. It is India’s only shipyard to have built destroyers and conventional submarines for the Indian Navy. The company, which launched its IPO in 2020, is now listed on the National Stock Exchange as well as the Bombay Stock Exchange. It was given Navratna status in 2024. “Interestingly, people associate MDL with defence manufacturing. But, of the 806 vessels we have built so far, only 31 are warships, and eight are submarines. The rest are all cargo ships, passenger ships, supply vessels, multipurpose support vessel, water tankers, tugs, dredgers, fishing trawlers, barges and border outposts for various customers in India as well as abroad. MDL has also fabricated and delivered jackets, main decks of wellhead platforms, process platforms, jack-up rigs,” said Biju George, Director, Shipbuilding. He emphasised that the yard had the requisite skill-set for its foray into building large merchant ships. To transition to the future, though, a key question for the yard is whether technology transfer is the way ahead or whether foreign partners like Korean or Japanese companies should be equity holders with operational control. “The idea is to learn from the companies which have been leading in commercial shipbuilding for decades, and to put India’s progress on a fast trajectory. Having skin in the game is very important. That is why we are even willing to give operational control to Korean or Japanese partners while the management control will stay with us and an Indian company,” Captain Jagmohan, CMD of MDL, said. Thriving naval shipbuilding Captain Jagmohan wonders why the country has not yet had a robust commercial shipbuilding profile, over 75 years after independence. “We are a maritime nation with a strategic location. At this stage, we are expected to have a robust and mature ship-building industry. While our naval shipbuilding has really thrived, we don’t have much in commercial shipbuilding. Why this dichotomy?” he asked. While discussing the issue, he said that the push by the Government of India since the 1960s led to domestic capability-building in construction of naval warships. “The shipyards always had to catch up with demand. That was never created for the commercial side. For the first time, we have a stable policy framework that is pro-shipbuilding today,” he said. And while government support and subsidies will help bolster production, sustained domestic demand will be key to the country’s progress in this challenging domain, he felt. “But it isn’t just the domestic demand which will help sustain commercial shipbuilding. We will need to meet the demands of the international markets too,” Mr. George said. Teething troubles There are teething troubles. MDL awaits a response from the Tamil Nadu government to identify land for the setting up of a 1,050-acre yard in Tuticorin. “Our board has approved forming a 1,050-acre yard in Thoothukudi. We were promised by the Tamil Nadu government that they have a one-stop-shop. It is not yet forthcoming. The Chidambaranar Port has to formulate an SPV (Special Purpose Vehicle) and then come to us through an EOI (Expression of Interest). That hasn’t happened yet. We have been waiting since November last year,” Captain Jagmohan said. While he said that the yard was willing to wait to go to Tamil Nadu, the company isn’t happy with the progress so far. “Hopefully, this is just initial teething troubles,” he said, adding that the State offered several advantages as it is an industrialised state with a lot of available waterfront. “We want to move forward. Once land is identified, we can move forward with respect to getting the partners onboard and so on,” he said, adding that he was dismayed at the prospect of paying for the port land. “Many States are giving land free of cost,” he said.