Demand for paints expected to grow by 15% annually in India

The market for marine paints in a country depends on the
size of its shipbuilding industry and capacity of its ship
repairing yards. In the past decade and a half the world
has seen the east, particularly China, South Korea and Japan
eclipsing the west as the focal point of building new ships and
repairing and painting the ones in service. In fact, the east
now owns over 75% of the world shipbuilding capacity. As
India’s profile in the shipbuilding industry has
started growing at a fairly good pace since 2002-03, the
world’s leading marine paints manufacturers are
strengthening their presence here.
An official of Indian Paint Association says International Paint
of AkzoNobel group, Jotum, Chogoku, Kansai Paint and Nippon
Paint are all here either on their own or through joint ventures
with this country’s leading paint manufacturers. To start with
not all of them are not straightaway building factories to
manufacture here marine paints belonging to industrial paints
group. But going forward local production is the common
target. Marine paints and paints used in rigs yield high margins.
Their production, however, calls for the use of technologies not
available with Indian manufacturers. India, therefore, needs the
presence of such companies here as it is also in their
commercial interest. Since all of them have big production bases
in south-east Asian and Far Eastern countries, importing marine
paints into India is not an issue.
According to a shipping ministry official, the demand for
marine paints in India should be growing annually 15% or more
as both government and privately owned shipyards have their
order books full and quite a few new shipyards are in advanced
stages of planning or execution. India has 27 shipyards of which
eight are in the government sector. India is planning to be able
to make ships worth $20bn annually by 2020 against $5bn now.
“This will spin off big demand for marine paints and we want
large foreign investment in this sector. Mind you those placing
orders for ships or getting their vessels repaired are insisting on
application of paints which will restrict CO2 emission, stop
fouling seawaters and lead to reduction in fuel consumption as
vessels ply. Technology to make such paints is not locally
available. But we hope in view of the growing size of the Indian
market for marine paints and the country’s welcoming attitude
to foreign investment, international paint manufacturers will see
merits in local production of high tech paints than meet our
demand through imports,” says the official.
The IPA official says the Indian shipyards will continue to have
their order books full as the International Maritime Organization
has asked for the phasing out of all single hull tankers by 2010
and scrapping of vessels more than 25 years old. Moreover, a
country with exports of around $170bn and imports of $309
will want more and more modest size and Handymax vessels to
be built locally. Paints will come into play in this endeavour in a
Demand for paints expected to grow by 15% annually in India
big way as companies placing orders for vessels will demand
performance standards for protective coatings. New regional
regulations limiting volatile organic compound (VOC) emissions
are also to be honoured.
A shipbuilder says while shipyards pursue different
construction methods and specialize in the construction of
certain kinds of ships, they are all exposed to seasonal climatic
fluctuations. Moreover, they are subject to hosts of global and
local regulations becoming increasingly demanding. Therefore,
the challenge for marine paint manufacturers is to offer
shipyards in different locations customized primers satisfying
varied requirements. The marine business section of
International Paints claims that for newbuilding shipyards, its
product range offers “universal application, high volume solids
with low VOC.” The product range is claimed to have year
round workability with long overcoating intervals.
As ship-owners are becoming more and more environment
and cost conscious, they will be demanding high-performance
corrosion and abrasion resistance coatings for long-term asset
protection. Paints companies are investing heavily in R&D to
come up with more technologically advanced and
environmentally responsible coating solutions in the face of
International Maritime Organization becoming increasingly strict
about protection of seawater and marine life and NGOs keeping
an eternal vigil on vessels in use. It is in this context that
International Paints is commissioning a new R&D centre in
Singapore whose focus will be the development of next
generation anti-fouling and foul release technologies. The
Singapore R&D centre is billed as a key link in the company’s
global network of R&D facilities dedicated to marine paints.
In India marine paints are seen as part of industrial paints
family which has a share of 30% of the total paints market,
including decorative variety, of around $2.2bn. Thanks to the
increasingly vibrant shipbuilding and ship repairing sector and use
of a growing number of offshore rigs for oil exploration and
drilling purposes, marine paints will meet with strong demand in
days to come. In fact like in developed countries in India too the
market will in the next few years be equally shared by industrial
and decorative paints. By Kunal Bose in Calcutta