PM Economic Advisor Sanjeev Sanyal Highlights Risks of Foreign Ship Dependence

India’s reliance on foreign-flagged vessels, which transport over 90% of the nation’s trade by volume, has raised significant concerns regarding its strategic vulnerability. Sanjeev Sanyal, a member of the Economic Advisory Council to the Prime Minister, emphasized that the limited size of India’s merchant fleet hampers economic resilience, especially during global crises. He advocates for a robust commercial maritime capacity to complement naval strength, highlighting the need for India to build and own its ships to enhance its economic stability.

Strategic Vulnerabilities in Maritime Trade

Sanjeev Sanyal has voiced strong concerns about India’s heavy dependence on foreign vessels for trade. He noted that this reliance poses a serious risk to the country’s strategic interests. According to Sanyal, a limited merchant fleet can hinder India’s economic resilience, particularly in times of global instability. He pointed out that while naval power is crucial, it is equally important to develop a strong commercial maritime sector. “Ships and maritime capability are among our biggest strategic weaknesses,” he stated, underscoring the necessity of a robust merchant fleet to support the economy during both prosperous and challenging times. Sanyal believes that merely possessing a navy is insufficient; India must also focus on owning and constructing its own ships to ensure comprehensive maritime security.

Government Initiatives to Strengthen Domestic Shipping

In response to these vulnerabilities, the Indian government is taking significant steps to bolster the domestic shipping and shipbuilding industry. Recent policy measures have granted infrastructure status to ships and introduced legislative reforms aimed at simplifying ownership structures and attracting private investment. Sanyal highlighted a substantial Rs 77,000 crore package designed to expand India’s national fleet and enhance maritime capabilities. These initiatives are expected to not only strengthen India’s strategic position but also stimulate economic growth through the development of a vibrant shipbuilding ecosystem.

Economic Benefits of Expanding Shipbuilding

Beyond strategic considerations, Sanyal emphasized the economic advantages of scaling up shipbuilding activities in India. He described the shipbuilding sector as an “ecosystem of jobs,” noting its labor-intensive nature and extensive industrial linkages. The process of shipbuilding involves significant engineering, welding, and the use of steel, which can create ripple effects across various sectors, including heavy manufacturing and logistics. Sanyal pointed out that the expansion of this industry could provide substantial employment opportunities and contribute to economic growth.

Regional Opportunities and Trade Strategy

Eastern India, particularly West Bengal, stands to benefit significantly from the government’s maritime initiatives. Sanyal referenced the region’s rich maritime heritage and existing infrastructure, such as Garden Reach Shipbuilders, as key assets. Historical ports like Chandraketugarh and Tamralipti, along with modern facilities in Kolkata and Haldia, highlight the state’s natural advantages in maritime activities. Sanyal expressed confidence that the government’s efforts to develop the shipbuilding and shipping industry would yield substantial benefits for regions like Bengal. Furthermore, he noted that the expansion of domestic maritime capacity aligns with India’s evolving trade strategy, particularly as the country engages in new free trade agreements with major partners like the US. He asserted that a strong shipping infrastructure will be vital for sustaining long-term economic growth as trade continues to expand.

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