HD Hyundai Heavy Industries (HHI), a leading South Korean shipbuilder, is considering establishing a shipyard in India to meet the rising local demand. A company delegation recently visited Tamil Nadu and engaged in discussions with L&T while also exploring potential collaborations in Andhra Pradesh and Maharashtra.

Hyundai’s Interest in India’s Shipbuilding Sector

As part of its expansion strategy, HD Hyundai Heavy Industries has initiated plans to set up a shipyard in India and has conducted site visits to assess viable locations. The company, which holds nearly 10% of the global shipbuilding market, visited Thoothukudi and Cuddalore in Tamil Nadu to evaluate potential sites. Additionally, Hyundai officials met with L&T executives to explore collaboration opportunities, given L&T’s existing shipyard in Kattupalli, which specialises in shipbuilding, retrofitting, and conversions.

Beyond Tamil Nadu, Hyundai’s interest extends to other coastal states. A source familiar with the matter confirmed, "HD Hyundai Heavy Industries came to India earlier this month to assess possible sites for a shipbuilding facility. They already have a shipyard in South Korea and are eager to establish one in India to cater to the local demand."

Competitive Bidding Among Indian States

The competition among Indian states to attract Hyundai’s investment is intensifying. According to an industry insider, "Tamil Nadu, Andhra Pradesh and Maharashtra are all aggressively courting the company."

The discussions follow a December 2023 visit by an Indian delegation led by Ports and Shipping Ministry Secretary T.K. Ramachandran. During the visit, Indian officials engaged with South Korea’s top shipbuilding firms, including Hyundai, to explore potential collaborations aimed at strengthening India's shipbuilding sector.

A shipping industry expert noted, "HHI is looking to partner with an Indian shipyard to collaborate and gain a greater share in India’s growing shipbuilding market." The expert added that Hyundai plans to share its advanced shipbuilding technologies with its Indian partners, which would provide local firms access to crucial equipment contracts and enhance India’s shipbuilding capabilities.

India’s Growing Shipbuilding Ambitions

The potential establishment of a Hyundai shipyard aligns with India's long-term goal of expanding its role in the global shipbuilding industry. At present, India contributes less than 1% to global shipbuilding activities, but the government aims to rank among the top 10 nations by 2030 and reach the top five by 2047.

To support this ambition, the Indian administration has proposed a new shipping enterprise with plans to expand the domestic fleet by at least 1,000 vessels over the next decade. This initiative aims to reduce international freight costs by one-third by 2047 and increase trade revenues through joint ventures between government-run entities and private enterprises.

An industry expert highlighted the increasing demand for ships due to stricter environmental regulations and global trade growth. "Existing shipyards are operating at full capacity, and order books are packed. Hyundai has previously attempted to set up shipyards in the Philippines with limited success. Given the Indian government’s focus on domestic shipbuilding, Hyundai now has an opportunity to establish a strong presence outside Korea."

Experts believe Hyundai’s potential investment in India would significantly boost the country’s shipbuilding sector, increase confidence among global shipowners, and promote advanced technology transfer.

Hyundai’s Legacy in Shipbuilding

HD Hyundai Group traces its origins to 1947, founded by Chung Ju-yung. The company’s shipbuilding division began in the early 1970s, and construction of its first major shipyard commenced in March 1972. Today, Hyundai’s shipyard in Ulsan, South Korea, spans four kilometers and features ten large-scale dry docks and nine massive ‘Goliath Cranes.’ By 2023, the company had delivered over 2,300 ships to 335 clients in 51 countries.

Hyundai employs approximately 15,000 professionals across various departments, including production, engineering, management, and administration. The company’s financial performance has seen remarkable growth, with recent reports indicating that its operating profit surged to 705.2 billion won, nearly four times the previous figures.

If Hyundai proceeds with its shipyard in India, it could mark a transformative shift in the nation’s shipbuilding landscape, positioning India as a key global player in maritime manufacturing.