News / MOL looks for more investment in India, eyeing shipbuilding and logistics

Japan’s MOL is the latest ocean carrier to be exploring more investment opportunities in India, with shipbuilding and inland logistics the new targets.

The renewed investment interest follows recent talks between prime minister Narendra Modi and his Japanese counterpart, Ishiba Shigeru, in Tokyo, which drew wide attention amid New Delhi’s tariff uneasiness with the US – India faces the steepest tariffs, 50%, in Asia.

Both India and Japan vowed to build on bilateral ties, Tokyo promising to double private investment from a previous five-year target through 2026 to some $67bn over the next 10 years.

Riding on that push, Japanese transport major MOL is reportedly seeking to establish ties with Indian yards for building medium-range product tankers and keenly pursuing projects linked to rail logistics asset development.

The latter sector remains a key priority in government and industry efforts to enhance supply chain efficiency and tighten logistics costs.

India’s shipbuilding market is heavily capacity constrained, but there are some “green shoots” in the offing. Cochin Shipyard (CSL) — India’s largest shipbuilding facility — recently inked a strategic MoU with South Korea’s HD Korea Shipbuilding & Offshore Engineering, to jointly develop new capabilities.

“A significant step toward strengthening India’s shipbuilding ecosystem through global collaboration and knowledge exchange, enhancing self-reliance and competitiveness in the maritime sector,” said CSL.

Container carrier heavyweights have led a march into India. Maersk has confirmed shipbuilding and ship repair service plans at the Cochin yard and there are similar signals from CMA CGM and MSC, following spillover demand out of busy yards in China and South Korea.

Meanwhile, Japanese companies already have high investment stakes in India, having pumped in more than $40bn. Japan Bank for International Cooperation, owned by the government, has also supported India as the ‘most promising’ investment destination.

And MOL already has a network presence in India, including a subsidiary unit at the International Financial Service Centre of Gift City in Gujarat – a business district offering multiple regulatory benefits, particularly tax exemptions – with the primary objective of pursuing vessel leasing interests. Some 13 MOL ships have already been reflagged to the Indian registry.

The group has also founded a logistics subsidiary in India, mainly providing rail logistics solutions for automobile manufacturers and other multimodal services.