India seeking to manufacture marine engines

In an attempt to tap increasing demand for ship engines, India?s largest shipping firm, the state-owned Shipping Corp. of India Ltd (SCI), is joining hands with a few government-run ports to enter the business of manufacturing diesel engines for ships. The alliance, led by SCI, also includes Jawaharlal Nehru Port Trust, Mumbai Port Trust, Kolkata Port Trust and Cochin Shipyard Ltd.

Mohapatra, secretary Union ministry of shipping, said there is an acute shortage of ship engines at a time when shipyards across the globe are fully booked for the next few years. The order books of the main ship engine manufacturers such as MAN Diesel, Rolls Royce and Wartsila are full. If an engine is ordered today, it will not be delivered until 2010. “The idea is to have technological autonomy in shipbuilding and related activities for the country,” Mohapatra said.

The shipping ministry has suggested a few modifications to a preliminary blueprint for this project prepared by audit and consulting firm Ernst and Young and the final report will be submitted by the consultants in the next few days.

ABG Shipyard Ltd, India?s biggest private sector shipbuilder, had earlier said that it would invest close to $100 million to set up a ship engine factory at Dahej, Gujarat.

With local shipyards adding capacities and new players entering the shipbuilding business, demand for ship engines within India is set to increase and this dependence on overseas factories for marine engines creates additional bottlenecks for Indian shipbuilders. Local shipyards now have to wait for up to 24 months to get an engine compared with 12 months previously. Making engines locally would not only cut delivery times, but also costs.

Major engine manufacturers, including MAN Diesel, Wartsila and Rolls-Royce, are also considering setting up facilities in India in an attempt to cash in on India?s rapidly increasing shipbuilding industry which is expected to expand at 30% a year. Traditional shipbuilding nations such as South Korea and Japan have turned down orders for relatively smaller ships for lack of capacity in their shipbuilding yards.