India’s maritime sector is very vital for country’s trade and economic aspirations for it generates around 95 percent by volume and 70 percent by value. However, it is still in the need for significant reforms, investments, and modernization so as to better its shipbuilding capacity, which must be accompanied by new infrastructure facilities and a reduced reliance on foreign vessels. In this regard, the rising height of globalization and the problem of climate change is calling for some serious reformations and investment into the India maritime capabilities and their strategic panning.
| GS Paper | GS Paper II, GS Paper III |
| Topics for UPSC Prelims | India’s maritime sector, Shipbuilding, SARFAESI Act, Maritime India Vision 2030, Sagar Mala Program, Red Sea crisis, String of Pearls, Security and Growth for All in the Region (SAGAR) vision, India-Middle East-Europe Economic Corridor , Harit Sagar Initiative , INS Vikrant, BIMSTEC , IORA, Coastal Regulation Zone. |
| Topics for UPSC Mains | Current Status of India’s Maritime Sector, Major Issues India Faces in Enhancing Maritime Infrastructure |
This editorial is based on the article “India needs to build ships” published in Financial Express on 12/11/2024. It highlights India’s dependence on foreign vessels and the urgent need for policy reforms to strengthen its shipbuilding and maritime infrastructure.
Knowing India’s maritime sector thus becomes the gateway for topics in GS Paper 3, covering infrastructure, economy, and international relations: it helps aspirants understand India’s trade dependencies and strategic vulnerabilities and ensuing policy interventions as insight for questions on economic growth, security, and sustainable development goals.
Maritime facilities in India are an interesting avenue because the sector is significant in international trade and strategically located. Increasing freight costs, dependency on foreign vessels, and geopolitical pressures in the Indo-Pacific region require reforms like Maritime India Vision 2030 and the Sagarmala Program. All these developments fit well into the themes of infrastructure and security for UPSC.
India is heavily reliant on the maritime sector, as 95% of the country’s trade by volume and 70% by value happens through this sector. The efforts of Maritime India Vision 2030 and the Sagarmala Program are being undertaken to modernize ports, enhance connectivity, and boost coastal industrialization while maintaining the country’s topmost position in ship recycling.
India ranks at 16th place in the list of the biggest maritime nations, as it is the all ports of the nation, and the majority of the nation’s trade is held by those ports. It holds 95% of the trade by volume and 70% by value. This sector can only be gauged as important to the country economy and external trade on account of it holding the potential of enhancing maritime infrastructure.
India is the largest ship recycler, consuming 30% of the world market. The significance of Alang can thus be considered a referral to the Indian position in this industry. This segment of the economy contributes importantly to its environmental sustainability and aligns with global practices as well, into this promotion of circular economic initiatives.
Maritime India Vision 2030 and the Sagarmala Program is a vision to modernize maritime infrastructure in India. Port modernization, enhanced connectivity, and coastal industrialization are targeted through these initiatives. Projects are oriented toward developing economic benefits, employment generation, and the deployment of advanced technologies in ports.
Investment in maritime infrastructure is essential for building economic resilience and strategic positioning in the Indo-Pacific while remaining environmentally sustainable. Improving domestic shipbuilding and port operations will reduce trade costs, enhance autonomy, and keep pace with India’s growing role in regional and global trade.
Dependency on overseas shipping to transport 95% of Indian trade incurs heavy economic costs, with freight expenses standing at more than $75 billion a year. To create indigenous shipbuilding capabilities and ports will reduce reliance on outside sources, keep forex reserves within the country, and ensure safe passage of these vital trade routes.
The SAGAR vision and IMEC corridor strategic initiatives of India enhance its strategic presence in the Indo-Pacific. It saves India from the clutches of China’s nefarious strategy of String of Pearls and strengthens regional security besides enhancing India’s competitiveness in the global trading scenario.
India offers 10 percent of the global maritime workforce, bringing forth its demographic potential. With this ambitious plan of creating employment through port-led development, Sagarmala is going to strengthen the skill enhancement of people in coastal and maritime sectors to meet needs worldwide.
Programs such as the Harit Sagar Initiative and zero-emission vessels drag India into international sustainability goals, while ports upgrade with renewable energy and emission-reduction systems to reflect the country’s commitment to both environmental compliance and energy efficiency.
India also faces financing, operational, and connectivity challenges in its maritime sector. Long regulatory clearances, inefficient ports, and lack of skills at the sites hinder the competitiveness of Indian shipbuilding and shipping operations and hence impact trade and economic growth.
Exclusion in the SARFAESI Act and the list of harmonised infrastructure limit financing toward shipbuilding. Import raw material costs are high, and credit is not easily accessible, thus hampering the growth of indigenous shipyards and making them less competitive globally.
Indian ports lack efficiency and mean turnaround time is high at 2.1 days against 0.6 in global benchmarks like Singapore. Moreover, ultra large vessels cannot dock in major ports due to limited depth, whereby compelling the situation to get trans-shipped abroad.
India has accounted for 10-12% of the global seafarers but is weak in advanced shipbuilding and automation skills. A paucity of facilities for training and lacunae in the adoption of technology exercises a significant restraint on the development of specialized maritime skills required for modernization.
Overlapping jurisdictions and regulations have caused delays in port expansion and project clearances. Further requirements of Coastal Regulation Zone norms and problems with land acquisition cause longer timeframes, thus slowing the development of critical infrastructure.
Although India has a 7,500 km coastline, coastal shipping accounts for only 6% of the country’s domestic freight. Poor rail connectivity at ports and lousy systems on the hinterland add to logistics costs and restrict movement of cargo in a multimodal manner.
India needs integrated port development strategies, smart technologies, and green initiatives to enhance maritime infrastructure. Enhancing multimodal connectivity, skill development initiatives, and private sector participation can provide the opportunity for India to become a global leader in the maritime sector.
A unified National Port Grid Authority can streamline operations, whereas a hub-and-spoke model optimizes cargo movement. Linking ports with industrial corridors and special economic zones ensures sustainable cargo flows and economic integration.
The IoT, blockchain, and smart port systems can unlock much efficiency and transparency. Pilot projects undertaken at key ports like JNPT and Mundra already indicate that the full potential of advanced digital technologies in port management may be realized.
Dedicated freight corridors and integrated logistics parks will be given, ensuring unhindered cargo movement. Standardized rail-road connectivity models reduce logistics costs and support seamless trade to increase port competitiveness of India globally.
Mandating renewable energy use and emission-reduction systems enhances sustainability. Green corridors and environmental monitoring systems ensure that India’s ports will be aligned with international environmental standards and climate commitments.
Maritime skill development centers and international exchange programs bridge workforce gaps. Training programs for port automation and smart operations condition India’s maritime workforce towards future technologies and global competition.
Reforms in PPP frameworks should encourage balanced risk sharing to spur private investment. Investment trusts in infrastructure are given long-term funding to support the expansion and modernization of maritime infrastructure.
| Political: India’s maritime sector is shaped by government policies such as the Maritime India Vision 2030 and Sagarmala Program. These initiatives focus on port modernization and coastal development. However, the exclusion of ships from the SARFAESI Act and fragmented regulatory frameworks create inefficiencies. International relations, including Indo-Pacific security dynamics, also impact India’s strategic maritime initiatives. Economic: The sector handles 95% of India’s trade by volume, reflecting its importance in global trade. High freight costs, overreliance on foreign vessels, and limited shipbuilding capacity strain economic resilience. Initiatives like Atmanirbhar Bharat aim to boost self-reliance and reduce foreign dependency, while green energy investments align with global economic trends. Social: The maritime sector supports employment through initiatives like Sagarmala, which creates millions of direct and indirect jobs. India’s strength in seafaring workforce, supplying 10% of global maritime labor, underscores the importance of skill development. Coastal community development initiatives aim to uplift livelihoods and integrate local populations into port-led growth. Technological: The adoption of smart port technologies, IoT, and blockchain can revolutionize efficiency in port operations. However, the sector lags in digital integration and automation compared to global competitors. Investments in green shipping technologies, including zero-emission vessels, reflect the push toward innovation and alignment with international standards. Environmental: India’s maritime initiatives align with its COP28 commitments, focusing on renewable energy integration and emission reduction. Projects like the Harit Sagar Initiative highlight sustainable port development. Coastal regulation compliance is crucial to balancing economic growth with environmental protection, especially in ecologically sensitive regions. Legal: Regulatory inefficiencies, overlapping jurisdictions, and delays in land acquisition hinder maritime infrastructure growth. Lack of a single-window clearance system and challenges in Coastal Regulation Zone compliance create barriers. International maritime laws and conventions also influence India’s compliance and operational strategies in global waters. |
The maritime sector is regarded as the huge potential area that can support India’s economic aspirations and strategic goals. It can ensure, with robust, sustainable, and technology-driven maritime infrastructure, a boost in trade resilience, jobs creation, and a reduction in foreign dependence. Through focused reforms and collaboration, India can emerge as the global leader in maritime trade and regional connectivity.
| UPSC Civil Services Examination, Previous Year Questions (PYQs) Mains Q. Discuss the importance of the Indian Ocean for India in terms of security, trade, and diplomacy. Suggest measures for strengthening India’s maritime security. (UPSC Mains 2022, GS Paper III) Q. Evaluate the strategic implications of India’s dependence on foreign vessels for 95% of its trade. How does the ‘Maritime India Vision 2030’ aim to address these challenges? Discuss. |
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