Marine Sector

An Expert's View about Non-Automobile Transport Equipment in India

Posted on: 18 Jul 2012

India's Shipping industry ranks 15th by world tonnage with 90% of its external trade carried via sea routes.

Marine Sector in India India's Shipping industry ranks 15th by world tonnage with 90% of its external trade carried via sea routes. Most critical equipment and machinery used in India's shipbuilding industry is imported offering opportunities for UK companies. Market overview India has a coastline of 7516 km and carries about 90% of its external trade by volume (and 70% by value) via the sea route. The Indian Shipping industry comprises more than 774 vessels (Overseas and Coastal), with a gross tonnage of 13.9 million GRT and is ranked 15th in the world by tonnage. Shipbuilding in India is very fragmented. Though there are more than 32 shipyards of various sizes, commercial shipbuilding is controlled primarily by 8 shipyards, of these 2 have been added to the list recently. Indian Shipyards have an order-book of close to 260 ships with aggregate value in the region of £3.45-billion. The Indian shipbuilding, which was totally domestic till late 1990’s, has become export oriented. The potential size of the ship repair industry in India is around £542-million, which includes repairing required by Indian and foreign vessels calling at Indian ports. Ship breaking industry in India is mostly concentrated at Alang in Gujarat, which the world’s largest ship is breaking yard catering to nearly 90 per cent of India's ship breaking activity. Key opportunities As shipbuilding in India is in its nascent stage, most of the critical equipment and machinery used in ships are imported. Latest export opportunities – Marine Latest export opportunities – India Getting into the market A new entrant to the Indian market can decide on one of the following options depending on the expected volume of business, the nature of business, market potential and its long term strategy for the Indian market. ξ To appoint a Distributor: For many companies this is the most ideal entry option, which does not require much in the way of resources. But the selection of the right distributor is essential. For most industrial products, one exclusive indenting agent or distributor is the most common arrangement. ξ Liaison Office: A Liaison office is free to undertake market development activities but is not allowed to transact any business (read – raise invoices). Expenses of these type of offices must be met through inward remittances from the Head Office abroad. The Reserve Bank of India grants approval for the opening such offices. ξ Branch Office: Foreign companies engaged in manufacturing and trading activities abroad may set up a Branch Office to undertake buying and selling activities in India. This could render technical support and professional consultancy services but it is not allowed to undertake manufacturing activities. Permission from the Reserve Bank of India is required to set up a Branch Office. ξ Joint Venture / Wholly Owned Subsidiary: A foreign company can commence operations in India through incorporation of a company under the provisions of the Indian companies Act (1956). Foreign equity in such companies can be up to 100% depending on the business plan of the foreign investor and prevailing investment policies of the Government. Although in most cases foreign investments can be approved through the Automatic Approval route by the Reserve Bank of India, some cases that do not meet the standard guidelines require specific approval from the Foreign Investment Promotion Board. Before signing any agreement, it is advisable for any foreign company to consult a lawyer. More about doing business in India Contacts Market intelligence is critical when doing business overseas, and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS). To commission research or for general advice about the market, get in touch with our specialists in country - or contact your local international trade team. ξ Pradnesh Desai, British Deputy High Commission, Mumbai, India Tel: +91 (0)22 66502226 or email: pradnesh.desai@fco.gov.uk. Contact your local international trade team Events UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows. Inmex India 2013 Date: 8-10 October 2013 Website address: www.inmexindia.com SMM India 2013 Date: 4-6 April 2013 Website address: http://smm-india.com UKTI Events UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows. Latest events – Marine Latest events - India Useful links More about OMIS and other UKTI services for exporters
Posted: 18 July 2012

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