Japanese shipbuilder eyeing to invest in Dugarajapatnam maritime cluster project

The proposal to set up a ship breaking unit as part of a maritime industrial cluster at Dugarajapatnam with funding from the Central Government and a major stake by Visakhapatnam Port Authority (VPA) has started yielding positive results with Japan's Imabari Shipbuilding evincing interest to take part in the project.

The issue is understood to have figured during a bilateral discussion between Union Minister for Ports, Shipping Sarbananda Sonowal and Tarada Yushimichi, Vice Minister of International Affairs & Ministry of Land, Infrastructure, Transport and Tourism in Oslo sometime ago. The Japanese shipyard is keen on exploring joint venture opportunities in Andhra Pradesh and Gujarat.

The meeting assumed significance as it came close on the heels of Chief Minister N. Chandrababu Naidu's assertion that they will set up a ship building and repair cluster at Dugarajapatnam. The State wants equity participation in the form land being provided out of estimated total project cost of Rs.3,500 crore.

According to the State Government, the Dugarajapatnam project, once materialises will propel economic prosperity in the region as it will attract a total investment of Rs.26,000 crore with 5,000 direct and 30,000 direct jobs

The project is mooted for development in 2,000 acres with half of it dedicated to core shipbuilding and the balance for ancillary industries. Though development of a greenfield port at Dugarajapatnam was a commitment made by the Centre at the time of bifurcation, it hit a roadblock with the feasibility studies finding out that it was not financially viable.

Preliminary studies made by VPA recently ruled out any environmental impact due to the ship breaking unit on the economically sensitive Pulicat Lake and Sriharikota Space Research Centre. A senior VPA official told Bizz Buzz that a decision on the extent of their equity participation will be decided shortly.

According to sources in the shipping industry, around 300 ships both from India and abroad need breaking and recycling in the facility available in Gujarat and few other places in Mumbai and Kochi. In addition to Visakhapatnam major port and non-major ports at Gangavaram, Krishnapatnam, the State Government is developing greenfield ports under aegis of Andhra Pradesh Maritime Board with BOT operators at Mulapeta, Ramayapatnam, Machilipatnam and Kakinada, to become a major player in port-led industrialisation.

Imabari Shipbuilding Group's President Yukito Higaki had led a high-level team to Amaravati to meet Naidu in February where they had discussed potential joint venture investment opportunities.

After the meeting, Naidu in social media platform X, had stated: "We discussed the vast opportunities Andhra Pradesh offers in shipbuilding, green recycling and ship maintenance yards."