Mazagon Dock Shipbuilders to buy controlling stake in Colombo Dockyard  

Colombo

Indian government-owned Mazagon Dock Shipbuilders Limited (MDL) has announced its decision to buy controlling stakes in Sri Lanka’s Colombo Dockyard in a $52.96 million deal.

The proposed acquisition, MDL’s first international venture, would give the Mumbai-based ship building yard 51 % equity in the Sri Lankan PLC that is grappling with persisting losses. A well-known ship repair, ship building, heavy engineering and offshore engineering facility in Sri Lanka, CDPLC has been saddled in debt over the years (over LKR 28 billion, or roughly ₹ 8 billion, in short and long term debt), Sri Lankan business newspaper the Daily Financial Times reported on Saturday (June 28, 2025), terming the Indian company’s acquisition “highly beneficial” for India and Sri Lanka. The transaction is expected to be completed in six months.

“Located in the Port of Colombo, Colombo Dockyard PLC (CDPLC) gives MDL a strategic foothold in the Indian Ocean Region– a key maritime corridor,” the MDL said in a statement. Colombo Dockyard was not immediately available for comment.

Last year, Japanese company Onomichi Dockyard, which held majority stakes in Colombo Dockyard, decided to exit from the firm. Colombo “urgently requested” New Delhi to “encourage Indian investors” to consider investing in Colombo Dockyard fearing the implications of a default, according to official sources from the Indian side. As per the due process followed for a listed company, Mazagon Dock Shipbuilders Ltd was shortlisted based on their experience in shipbuilding and financial strength, the sources said.

The development, of an Indian company acquiring controlling stakes at the facility located within the Colombo Port, comes amid New Delhi’s preoccupation with apparently growing Chinese outreach in the region. Over the last few years, India raised concern with Sri Lanka multiple times, over Chinese research vessel visits to its ports, prompting Colombo to impose a moratorium on foreign research vessels. President Anura Kumara Dissanayake’s government has said it would evolve a new national policy on the visit of foreign vessels.

MDL is not the first Indian firm to enter the Colombo Port. In April this year, Adani Ports and Special Economic Zone Limited commenced operations at the Colombo West International Terminal (CWIT) that it is jointly developing with the Sri Lanka Ports Authority and Sri Lankan Conglomerate John Keells Holdings, adjacent to the China-backed Colombo International Container Terminal (CICT) at the Colombo Port.