SOURCE: IDRW.ORG
Larsen & Toubro Ltd (L&T), India’s leading engineering and construction conglomerate, is poised to significantly expand its naval shipbuilding business by strengthening collaborations with state-owned defence shipyards and pursuing direct contract wins, according to a top company official. With a defence order book exceeding ?3,000 crore and a robust pipeline of opportunities, L&T is leveraging its expertise to capitalize on India’s growing naval modernization programs, export potential, and partnerships with public sector shipyards.
In an interview with ET Infra on May 27, 2025, Arun Ramchandani, Senior Vice President of Precision Engineering & Systems at L&T, outlined the company’s three-pronged strategy for growth in defence shipbuilding. “For now, our focus has been on defence shipbuilding, and we do see a potential for growth, one in terms of the number of shipbuilding programmes which are on the anvil, and two, a few export opportunities, and three, also working with the other yards,” Ramchandani stated. He highlighted the increasing demand for naval vessels and the capacity constraints faced by state-owned shipyards, which are prompting collaborative opportunities.
L&T is actively working with public sector defence shipyards to alleviate their overburdened order books, a move that aligns with India’s push for a robust and inclusive defence manufacturing ecosystem. Ramchandani revealed that L&T is currently building two out of five fleet support ships ordered by the Indian Navy for Hindustan Shipyard Ltd (HSL). Additionally, the company has completed the construction of four Anti-Submarine Warfare Shallow Watercraft (ASW-SWC) and a Large Survey Vessel for Garden Reach Shipbuilders & Engineers Ltd (GRSE).
This collaborative model, where L&T takes on subcontracted work from state-owned shipyards, is emerging as a key strategy to meet the Indian Navy’s growing demands. “The order books of most of the defence shipyards are quite swollen, and they are also looking at offloading some of the work,” Ramchandani noted. By partnering with HSL and GRSE, L&T is not only contributing to critical naval programs but also enhancing its reputation as a reliable partner in India’s defence ecosystem.
In addition to collaborations, L&T is aggressively pursuing direct contract wins through competitive bidding, a shift facilitated by the Indian Ministry of Defence’s recent policy to prioritize tendering for major defence projects. Ramchandani highlighted L&T’s success in securing contracts for multipurpose vessels and cadet training ships, demonstrating its ability to compete in the naval shipbuilding market. These wins underscore L&T’s technical expertise and its state-of-the-art shipyards in Kattupalli (Tamil Nadu) and Hazira (Gujarat), which are equipped to handle complex warship and submarine construction.
The company is also eyeing export opportunities as part of its growth strategy. With global demand for cost-effective naval platforms rising, particularly among nations in Southeast Asia, Africa, and Latin America, L&T is well-positioned to leverage its experience in building advanced vessels like corvettes, frigates, and survey ships. The Indian Navy’s growing international engagements and India’s push for defence exports under the “Make in India” initiative further enhance L&T’s prospects in this space.
L&T’s focus on naval shipbuilding aligns with the Indian Navy’s ambitious modernization plans, which include acquiring advanced frigates, destroyers, submarines, and support vessels to counter regional threats, particularly from China’s expanding naval presence in the Indian Ocean Region (IOR). Programs like the Next Generation Missile Vessels (NGMV), Next Generation Corvettes (NGC), and Project-75I submarines offer significant opportunities for L&T to secure new contracts, either directly or through partnerships.
The company’s defence order book, valued at over ?3,000 crore, reflects its growing role in India’s defence sector. L&T’s contributions extend beyond shipbuilding to include precision engineering, missile systems, and electronic warfare suites, positioning it as a key player in India’s “Aatmanirbhar Bharat” (Self-Reliant India) initiative. The collaborative model with state-owned shipyards also complements the Ministry of Defence’s efforts to integrate private sector expertise into defence production, as seen in initiatives like the dual production lines for the Astra Mk-II missile.
While L&T’s prospects in naval shipbuilding are promising, challenges remain. Coordinating with state-owned shipyards requires aligning timelines, quality standards, and cost efficiencies, particularly for complex projects like fleet support ships and anti-submarine vessels. The competitive bidding process, while fostering transparency, demands that L&T maintain a cost-competitive edge against both domestic and international players. Additionally, scaling up for export markets will require certifications and compliance with global standards, which could strain production capacities.
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