According to a report by CRISIL Ratings, in 2024–2025, the Indian ship recycling sector is expected to witness a revenue growth of about 15 per cent after a decline of 22 per cent in FY 2023-24 and 8.5 per cent in 2022-23.
The growth will be driven by two factors. First, the increased availability of ageing vessels for recycling due to addition of new vessel capacity globally; and second, the higher competitiveness of Indian ship recyclers as compared to its rival nations, Bangladesh and Pakistan.
The increased availability of ageing vessels will reduce input cost of ship recyclers. In addition, higher capacity utilisation will result to better efficiency, and will improve operating profitability by 6.5 per cent in 2024-25.