CAPACITY ASSESSMENT OF PRIVATE SHIPYARDS – NEED FOR A RELOOK

1. CAPACITY ASSESSMENT OF PRIVATE SHIPYARDS – NEED FOR A RELOOK Cdr Kinshuk De IHQ MoD(N)/DSP

2. WHAT IS CAPACITY ASSESSMENT OF SHIPYARDS Organisation & Infrastructure Shipbuilding Experience Product Profile Details of Collaboration Turnover and Financial Health Personnel with Background Orders Executed in last 05 years Orders in Hand and Future Orders Plans

3. WHAT IS CAPACITY ASSESSMENT OF SHIPYARDS Production facilities and Process Control Design Capability Quality Control Procedures Legal Issues

4. CAPACITY ASSESSMENT – PRESENT PROCESS Capacity Assessment Committee scrutinises Report of WOT with inputs of Domain experts Report approved by CWP&A RFP for Type of ships are thereafter issued to Shipyards with valid and current Capacity Assessment Validity is Two Years

5. NAVAL ASSETS - WORLD

6. NAVAL ASSETS - WORLD

7. NAVAL ASSETS UNDER CONSTRUCTION- WORLD

8. INDIAN NAVAL SHIPBUILDING

9. INDIAN SHIPBUILDING INDUSTRY

10. SHIPBUILDING – WORLD STATISTICS 62% vessels are delivered in good quality, within the budget and on time. 27% of vessels are delivered beyond one year after delivery date. 11% orders either get cancelled or land up in arbitration

11. SWOT ON INDIAN SHIPBUILDING – GLANCE

12. NAVAL SHIPBUILDING THROUGH PRIVATE SHIPYARDS – UNCERTAINTIES & RISKS Private Sector participation will improve the overall cost benefit, competition, participation, sector development, widen expertise etc Due diligence, risk assessment during the decision making process Need for continuous assessment of the shipyards for their capacity and competence to deliver Naval Warships

13. NAVAL SHIPBUILDING THROUGH PRIVATE SHIPYARDS – UNCERTAINTIES & RISKS Private shipyards have defaulted to deliver Yardcrafts and Survey vessels on time primarily due poor financial health, error in assessment of costs and shipyard capacity Issuance of RFPs may have been an error due in-accurate assessment of financial strength Limited Domain expertise within Navy to look at Balance Sheets

14. NAVAL SHIPBUILDING THROUGH PRIVATE SHIPYARDS – UNCERTAINTIES & RISKS Shipyard’s ability to compete and stay in business is greatly affected by its ability to know what it costs to do business

15. NAVAL SHIPBUILDING THROUGH PRIVATE SHIPYARDS – UNCERTAINTIES & RISKS Need for rigorous financial assessment as per checklists prior to Capacity Assessment by Credit Rating agencies with knowledge of present market dynamics, risks, rating of clients, management etc Process initiated

16. NAVAL SHIPBUILDING THROUGH PRIVATE SHIPYARDS – RECOMMENDATIONS Check Lists Financial assessment by Credit Rating Agencies Reputation of management, Promoters, track record and experience Assessment of production facilities, production process, productivity, Logistics Current order book, Knowledge, innovation, product mix, workforce

17. NAVAL SHIPBUILDING THROUGH PRIVATE SHIPYARDS – RECOMMENDATIONS Check Lists Planning & design infrastructure Organization & HR practices Procurement procedures Subcontractors, quality assurance, safety, health and environment Relationship with unions

18. NAVAL SHIPBUILDING THROUGH PRIVATE SHIPYARDS – RECOMMENDATIONS Need for weighted consideration of factors in Capacity Assessment with emphasis on financial assessment for Risk Assessment to ensure Quality Warships, Within Costs and on Time for our Navy

19. CAPACITY ASSESSMENT OF PRIVATE SHIPYARDS – NEED FOR A RELOOK Questions