Garden Reach Shipyard builds its 100th warship; It's order book is full for the next 20 years - Broadsword by Ajai Shukla - Strategy. Economics. Stuff.

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Tuesday, 30 July 2019

Garden Reach Shipyard builds its 100th warship; It's order book is full for the next 20 years















At current turnover, GRSE's order book is full for the next 20 years


By Ajai Shukla
Business Standard, 30th July 19

India’s second-biggest warship building yard, the public sector Garden Reach Shipbuilders & Engineers Ltd (GRSE), has completed delivery of its 100thwarship – the first Indian shipyard to achieve this feat.

In Kolkata, on Monday, the navy commissioned the vessel, an 830-tonne Landing Craft Utility (LCU Mark-IV) meant for transporting tanks, troop carriers, soldiers and equipment from large amphibious assault vessels to assault enemy shorelines.

GRSE’s lead will assuredly continue. Underlining the monopoly that the defence ministry’s four shipyards enjoy, GRSE says it has orders in hand for 22 more warships worth over Rs 27,500 crore. At the current turnover level of Rs 1,386 crore for 2018-19, GRSE’s order book is full for the next 20 years.

GRSE’s orders include the construction of three Project 17-A frigates, one remaining (out of four ordered) Project 28 anti-submarine corvette, eight anti-submarine warfare shallow water craft (ASWC), four large survey vessels, two remaining LCUs and four fast patrol vessels.

The three Project 17-A frigates were awarded to GRSE on “nomination”, which means without competitive bidding. They will be built using modular construction techniques and advanced software such as Aveva Marine and NAPA. The modular construction facilities, which cost over Rs 600 crore, were built at government cost.

Similarly, Mazagon Dock Ltd, Mumbai (MDL) has been “nominated” for orders to construct four Project 17-A frigates, four Project 15-B destroyers and six Scorpene submarines (of which one has been delivered).

In contrast, the private sector Larsen & Toubro (L&T) shipyard at Kathupalli does not have a single naval warship order. The other private sector defence shipyard, Reliance Naval’s (RNAVAL’s) Pipavav facility, has a relatively small order for naval offshore patrol vessels.

GRSE’s association with the Indian Navy goes back 59 years, when it built the first “seaward defence boat” for the navy. Since then, GRSE has built 780 platforms, including a 24,600 tonne fleet tanker. Of these, 67 are warships built for the navy and another 33 warships built for the Coast Guard and the government of Mauritius.

Meanwhile MDL, since it was nationalised in 1960, has built 795 vessels, including 25 warships and three submarines. MDL has built most of the navy’s frigates and destroyers – so-called “capital warships” that are larger, costlier and more complex to build.

The two remaining defence public sector shipyards – Goa Shipyard Ltd (GSL) and Hindustan Shipyard Ltd (HSL) – also enjoy “nomination” orders from the defence ministry. GSL has been “nominated” to build two of the four Russian Krivak-III class frigates on order, along with eight ASWCs (while GRSE builds eight more).

Meanwhile Kerala state shipyard, Cochin Shipyard Ltd (CSL) was “nominated” to build the first indigenous aircraft carrier, INS Vikrant.

The private sector shipyards, which includes Reliance Naval’s Pipavav Shipyard and L&T, have been agitating for orders on competitive basis. Their future depends upon whether the defence ministry decides to allow them to compete with the public sector yards for the forthcoming Rs 50,000 crore order for six more submarines.



4 comments:

  1. Really sad that on one hand L&T helps pull other nuts out of fire for MoD (Arihant hull, arty, OPV etc) and on the other MoD shies away from leveraging their full strategic capability for relatively minor considerations.

    - Manne

    ReplyDelete
  2. I thought Cochin Shipyard was owned by GOI, not Kerala.

    ReplyDelete
  3. I think some of these have to be handed over to pvt sector.
    We also need to take steps to build up capability to build civilian ferries & cargo ships.
    Then open a lot of dry dicks to offer MRO services along our vast coastline .

    ReplyDelete
  4. Why should we give order to private companies. This is a swadeshi sarkar and all such orders should go to swadeshi sarkar companies only...

    ReplyDelete

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