The Economic Survey 2023, which came out on Tuesday, said that the strategic shipbuilding industry, which is important for energy security, national defence, and the growth of the heavy engineering industry, has the potential to increase its and the services sector’s share of the national GDP.
“The shipbuilding industry has the potential to strengthen the goal of an Atmanirbhar Bharat because it has so many direct and indirect links with other major industries, such as steel, aluminium, electrical machinery and equipment, etc., and because it depends so much on infrastructure and services,” it said.
It said that the Indian Navy shipbuilding projects that are going on at different Indian shipyards will give the industry the boost it needs.
“With the goal of achieving strategic independence in shipbuilding and developing niche technology, as of now, more than 130 IN warships have been built at Indian shipyards, and 41 of 43 ships and submarines are being built at various public and private sector Indian shipyards,” the report said. It also said that these initiatives are helping the country’s economy grow and create jobs in different ways.
The Economic Survey also said that shipbuilding, which is linked to other industries like steel, engineering equipment, port infrastructure, trade, and shipping services, has the potential to create a collaborative production eco-system.
“It is important to note that about 65% of the value added to a ship comes from the companies that make the materials, equipment, and systems that go on board,” it said.
It said that shipbuilding can create a lot of jobs in remote, coastal, and rural areas, taking the place of people who leave farming to work in manufacturing facilities set up by shipyards and their related industries.
“For example, the recently launched INS Vikrant employed about 500 MSMEs, 12,000 people in related industries, and 2,000 people in shipyards,” it said.
A Navy study on the building of seven P17A ships shows that about three-quarters of the total cost of building warships is put back into the Indian economy.
“This investment is put back into the economy through local sourcing of raw materials, development of equipment and systems installed onboard ships, and other manpower services,” it said.
It said that a shipping and shipbuilding industry that is based in the country can also cut freight costs and foreign exchange outflows, lowering the current account deficit.