India To Invest $10 Billion To Build 112 Oil Tankers Locally By 2040

India has unveiled an ambitious plan to invest ₹85,000 crore (approximately $10 billion) to build a fleet of 112 crude oil tankers by 2040.

In the first phase of the project, the government intends to purchase 79 ships, 30 of which will be medium-range carriers. The first batch of 10 tankers is expected to be ordered later this month. Only ships constructed in Indian shipyards will be considered for procurement, even if they are built in partnership with foreign companies.

Currently, most vessels used by state-owned oil firms are aging and are leased from international companies. Sources say that both the shipping and petroleum ministries want more control and ownership of India’s energy transport system.

India is expanding its oil refining capacity significantly. Refining output is expected to rise from 250 million tonnes per year to 450 million tonnes by the end of the decade.

India, which ranks as the world’s third-largest oil importer, currently has just 5% of its tanker fleet built domestically. Government officials familiar with the matter said the aim is to increase this share to 7% by 2030 and a substantial 69% by 2047, the year India has set as a target for becoming a fully developed nation.

The Indian government earlier this year introduced a ₹25,000 crore fund dedicated to the maritime sector. One key objective of this fund is to reduce reliance on foreign-built ships and create a stronger local shipbuilding ecosystem.

Plans are also underway to expand India’s shipping capacity for other critical commodities such as coal, fertilisers, and steel. Authorities plan to replace a significant portion of this future demand with India-built vessels. But experts say India’s shipbuilding industry is still developing and not yet ready for large-scale commercial production.

To change that, the government is trying to create demand through big purchase orders, which could attract global shipbuilders to partner with Indian yards.

Per local reports, South Korea’s HD Hyundai Heavy Industries is planning to set up a shipbuilding facility in Kochi with Cochin Shipyard. Indian officials have also spoken with South Korean company Samsung Heavy Industries and Japan’s NYK Line about possible partnerships.

Rajiv Jalota, former chairman of Mumbai Port Trust, said this move is important for India’s energy security, especially since the country currently depends on Chinese services in this area.

India’s largest domestically-built oil tanker to date, the MT Maharshi Parashuram, measures 238 meters in length with a deadweight of over 93,000 metric tonnes. In comparison, China’s largest supertanker, the Oceania, boasts a length of 380 meters and a deadweight exceeding 440,000 metric tonnes, showing the gap India seeks to bridge in the coming years.

Reference: Bloomberg

Source: Maritime Shipping News