India, which currently accounts for less than 1% of global shipbuilding, has the potential to become a credible fourth-largest shipbuilding nation over the next decade, Prime Minister’s Economic Advisory Council member Sanjeev Sanyal said at News18 DEFCON 2026.
Sanyal said India has several key advantages that could support the expansion of its shipbuilding industry, including its position as the world’s second-largest steel producer, a large labour force, and established shipbuilding and ship-design capabilities.
“It’s a long way to go, but I think we can make a reasonable bet that in the next 10 odd years we will emerge as at least a credible number four in shipbuilding and maybe up hopefully after that,” Sanyal said.
He pointed to India’s experience in constructing complex vessels as a foundation for expanding into commercial shipbuilding.
“We have shipbuilding capability and design because we are building difficult things like aircraft carriers. Surely, we can build a tanker,” Sanyal said.
Sanyal also conceptualised the Stitched Ship Project, which led to the reconstruction of INSV Kaundinya, an ancient Indian trading vessel believed to be around 1,500 years old and constructed without nails. The vessel completed a voyage across the Indian Ocean in March 2026.
Significant Gap With China, South Korea and Japan
The scale of the challenge is reflected in the concentration of global shipbuilding capacity in China, South Korea and Japan, Sanyal said.
“We have every ingredient needed for being a major shipbuilding power but the current situation is that 55 percent of all the ships being built on this planet right now are being built in China. Another 20 odd percent is built in Korea, and another 20 odd percent is built in Japan,” he said.
“The rest of the world combined builds only 5 percent of the world’s ships, of which maybe India builds less than 1 percent. So, we are now heavily investing into building out a shipbuilding industry beyond just building navy ships, into proper merchant ships, large tankers, and so on.”
India’s government has introduced a ₹69,725-crore package aimed at strengthening the country’s shipbuilding and maritime ecosystem. The package includes financial assistance for shipbuilding, long-term maritime financing, shipyard development, technical capability building and policy reforms.
Dependence on Foreign Shipping
The push to expand domestic shipbuilding comes against India’s substantial dependence on foreign vessels and shipping lines.
“Ninety-five percent of all our trade by volume and 75 percent by value is carried by ships, and the bulk of it is carried by foreign ships,” Sanyal said. “Our trade is not only maritime but is controlled almost entirely by foreign shipping lines.”
India has around 480 ocean-going vessels, according to Sanyal, although most are medium-sized.
“So we don’t actually need sanctions by major countries. If three or four of the major shipping lines in the world decide they don’t like us, we will be in serious trouble,” he said.
“There is no short-term solution. Obviously, one part is we have to invest in our navy. In the end you need Indian vessels. We need to do something serious about shipbuilding, ship flagging, ship ownership.”
Changes to Maritime Laws
Sanyal also highlighted changes to India’s maritime legal framework, including reforms to laws dating back to the 19th century. The government has also increased support for shipbuilding and the wider maritime sector.
The Union Cabinet approved a ₹69,725-crore package in 2025 to revitalise India’s shipbuilding and maritime ecosystem. The 10-year programme includes a ₹24,736-crore Shipbuilding Financial Assistance Scheme, a ₹25,000-crore Maritime Development Fund and a ₹19,989-crore Shipbuilding Development Scheme. The government has said the measures are intended to expand domestic shipbuilding capacity, improve financing and support infrastructure and technical development.
“We managed to change all our shipping-related, maritime-related laws, some of them going back to the 19th century. So now we have very modern maritime laws. We are now investing heavily into shipbuilding,” Sanyal said.
He also emphasised the need to create greater opportunities for private-sector participation.
“It’s not about the money. After many of the things, like the changes in law, doesn’t need money. Somebody had to apply their mind into it. It’ll only get done if it is a priority,” Sanyal said.
