In a major geopolitical and industrial shift, India’s Mazagon Dock Shipbuilders acquires a controlling stake in Colombo Dockyard PLC, replacing Japan’s Onomichi Dockyard. The move is set to transform Sri Lanka’s shipbuilding landscape with Indian warship and submarine expertise.
India’s Mazagon Dock Shipbuilders Acquires Colombo Dockyard Stake as Japan Exits
In a landmark move reshaping regional shipbuilding power dynamics, India’s Mazagon Dock Shipbuilders Ltd. (MDL), a premier warship and submarine manufacturer under the Indian Ministry of Defence, is taking control of Colombo Dockyard PLC (CDPLC), replacing Japanese stakeholder Onomichi Dockyard.
The deal, finalized on June 27, 2025, through a tripartite agreement between MDL, CDPLC, and Onomichi Dockyard, will see the Indian state-owned entity invest up to USD 52.96 million to acquire a controlling and substantial stake in Colombo Dockyard. The acquisition comes at a crucial time, as the Sri Lankan shipyard was struggling with debt and on the verge of default.
India responded to a request by the Sri Lankan government to encourage Indian investments in the financially distressed dockyard. Mazagon Dock, selected for its shipbuilding reputation and robust financials, is seen as the ideal candidate to revive Colombo Dockyard’s operations.
Mazagon Dock’s financial standing adds weight to the acquisition. The company, nearly debt-free, boasts a market capitalization of approximately USD 15.12 billion and a turnover of USD 1.13 billion, which could be pivotal in resuscitating Colombo Dockyard’s fortunes.
The acquisition is expected to generate continuous revenue through new repair, refit, and construction contracts many of which MDL can now route to Colombo. This includes potential deals from both domestic Indian and international clients, leveraging MDL’s global footprint and the strategic location of Sri Lanka.
As India strengthens its footprint in Sri Lanka’s maritime infrastructure, this deal also represents a larger geopolitical trend India extending its influence in South Asia, replacing Japan in a key regional asset. Experts predict the move will boost intergovernmental and industrial ties between the two countries, foster skill and technology transfers, and bring Colombo Dockyard into a new era of growth and relevance in global shipbuilding.
