India has signalled its growing maritime ambitions in the Indo-Pacific with the public-sector Mazagon Dock Shipbuilders set to acquire a controlling stake in Sri Lanka’s Colombo Dockyard, the island nation’s largest shipbuilding and repair firm.
Mazagon Dock said last week it would purchase a 51 percent stake in the Colombo-based yard for $52.96 million. The deal, expected to close within six months, marks the company’s first international acquisition and a key step in expanding its footprint in the Indian Ocean region.
In a social media statement, Mazagon Dock described the move as a strategic leap: “With this, we begin our transformation from a domestic shipbuilder to a regional maritime player with global ambition.”
Colombo Dockyard, located inside Sri Lanka’s main port, services over 200 ships annually, with the capacity to handle vessels up to 1,25,000 deadweight tonnage (DWT). It has operated for over five decades and maintains commercial and government clients across Asia and Africa. Until recently, it was majority-owned by Japan’s Onomichi Dockyard, but has faced financial difficulties in recent months.
Analysts say India’s acquisition will expand its maritime reach both regionally and globally, amid intensifying strategic competition with China in the Indian Ocean.
China Merchants Port Holdings already holds an 85 percent stake in Sri Lanka’s Hambantota port under a 99-year lease—a move widely seen as a key node in Beijing’s Belt and Road Initiative.
“This latest acquisition signals greater boldness in pursuing global ambitions—similar to China’s long-standing strategy,” said Uday Chandra, assistant professor of government at Georgetown University.
However, Chandra added that the move wasn’t solely about countering China. “It reflects India’s ambitions not just in its neighbourhood, but across West, Central and Southeast Asia, the African continent, and the proposed Middle East–Europe economic corridor.”
While Mazagon Dock’s move bolsters India’s shipbuilding credentials in a key Indian Ocean hub, its implications extend beyond immediate competition with China, Chandra noted. “It shows a growing willingness by Indian corporations to look abroad for investment, particularly through mergers and acquisitions.”
India has been ramping up long-term investments in Sri Lanka, including in renewable energy and port infrastructure. The latest deal, analysts say, signals a broader strategic intent.
“This shows India is now embracing opportunities it previously allowed others—particularly China—to dominate,” said Harsh Pant, professor of international relations at King’s College London. “It reflects India’s desire to support its neighbours and play a more assertive regional role.”
India extended roughly $4 billion in financial and humanitarian aid to Sri Lanka in 2022–23 as the country struggled with an economic crisis exacerbated by the pandemic and a collapse in tourism.
The Colombo Dockyard deal also highlights improving relations between Delhi and Colombo, particularly since President Anura Kumara Dissanayake took office late last year.
“This deal would not have happened without the current Sri Lankan government’s confidence in India. Clearly, the trust level between the two sides is high,” Pant said.
In April, India and Sri Lanka signed their first defence cooperation agreement, paving the way for joint maritime drills, surveillance, and defence equipment support. The two countries are also expanding trade ties, with a focus on textiles, pharmaceuticals and IT.
Pant said India’s Colombo Dockyard move underlines its readiness to “play a role commensurate with its capabilities in the Indo-Pacific”.
Sri Lanka’s former government under Mahinda Rajapaksa was widely seen as tilting toward China for economic and political backing. But the new administration appears to be re-balancing.
“This is less an anti-China step than a re-calibration,” said Chandra.
Still, the move provides a clear alternative to Beijing’s dominance in regional infrastructure, said Priyajit Debsarkar, a London-based analyst of South Asian politics. But he warned that Mazagon Dock must act quickly to revitalise Colombo Dockyard and deliver local benefits