Rapid expansion in India’s shipping, energy and general industries, springing from sustained economic growth, is offering new opportunities and challenges for DNV. “When a country grows fast, you introduce a lot of additional risk. DNV’s goal is to ensure that risk is well-managed,” says Krishnakumar Neelkanta, DNV’s country chair and Director of Operations for DNV Industry India.
Supporting India’s efforts to forge itself into an innovative and technically advanced country, DNV, backed by over 140 years of experience and ongoing development of a variety of new value-adding services, is taking the lead in supporting India’s diverse industries to grow in a sustainable manner.
Explaining DNV’s beginnings in India, Mr Krishnakumar says that ship classification has been a foundation of the company since its establishment in the early 1970s. “Today, DNV is involved in all phases of the ships’ life, through ship classification, statutory certification and fuel testing. This maritime tradition has attracted new opportunities in growth markets throughout India,” he says.
Booming shipping sector
According to Mr Krishnakumar, India’s rapid expansion in shipping continues to present great opportunities for DNV. “In India we are developing rules for how ships should be built,” he says. “We are involved in the building and surveying of the ships and verify that they are meeting the minimum requirements that we set for safety.”
Though growth is not as fast paced as it is in China, India is posting high single-digit annual growth and is helping to fuel the growing demand for shipping. This development has unleashed a new wave of ship orders by Indian owners.
Norwegian owners such as Golden Ocean, Sea Tankers, Nor Lines and Sea Cargo are also placing orders at Indian yards, who are vying to bag a larger share of the shipbuilding market. Currently, DNV has close to 50 percent of the newbuilding market in terms of vessel numbers and 45 percent in gross tonnage.
Hungry for oil and gas
DNV is also involved in oil and gas activities in India. Its main services are offshore-oriented and include verification projects for companies such as Reliance, ONGC, Cairn Energy and British Gas. It is also working for some of the majors in the downstream sector as well as the clean energy (wind) segment.
“The rising oil and gas prices have also increased the need for DNV’s energy-related services,” says Mr Krishnakumar. He believes the thrust on exploration and development by oil companies will create even more work for DNV. “Stronger balance sheets, improved oil company cash flows and a matching regulatory regime with a clearly defined focus by the government on oil security would lead to more business,” he predicts.
While DNV is known for its expertise in shipping and offshore, the company’s other main business in India is derived from its certification business. It started doing “inspection work” for the general industries back in 1984 and is now recognised as one of the leading certification bodies India.
Rising demand for certification services
“The demand for certification of management systems is rising as companies seek to ensure quality products and services that can be trusted in the national and international markets,” says Mr Krishnakumar, adding, “we now provide a full range of services for managing and integrating safety, health, environmental and quality systems across the industrial spectrum. Our customers include Cisco Systems, HSBC, CAT (Caterpillar) Logistics, Suzlon Energy, Wipro, Dr Ready’s just to name a few.”
“Business is going well but there is so much more to be done so we are increasing our commitment to India as more and more customers are expanding their businesses in this fast-growing economy,” says Mr Krishnakumar.
Service differentiation
Despite the positive business developments, Mr Krishnakumar points out that certification services have to a certain extent become “standard practices” and, as a consequence, it has become increasingly important for DNV to differentiate itself from the competition. In order to do this, DNV must rely on the assets it can offer its customers, which extend beyond products and focus on more service-oriented operations. According to Mr Krishnakumar, its people are what set DNV apart from its competition.
“I want our customers to choose us because we are service-minded, have good, competent people and a uniform way of meeting our customers’ needs. We are trying to be innovative as regards what’s happening in the market and on adding value to our classification, certification and consultancy services,” he emphasises.
Commenting on future plans, Mr Krishnakumar firmly believes that DNV will grow significantly in the years ahead because there is a growing demand for DNV’s services beyond the general market growth. “There are several strong forces and trends that further increase this demand,” he explains. “Environmental concerns, globalization, corporate social responsibility and sustainable growth are direct business drivers for DNV. Many of these market drivers are related to what takes place in India.”
Managing risk
Areas where DNV is providing value-adding services in India include climate change, corporate responsibility, governance, enterprise risk management and sustainability reporting.
“At DNV, we recognise that risk management is becoming increasingly important for companies across all industries, which is why we remain committed to developing our core competencies to identify, assess and advise on how best to manage technical and business risks. By providing business with tools to manage risk, we strive to help our customers maintain a safe and sustainable business and, in the process, go some way to realising our purpose to safeguard life, property and the environment in India.”
As Mr Krishnakumar says, “It is a very large market and the potential is there, but it is also a very challenging market. To succeed, we just have to be better.” But then, as he also concedes, that has been the challenge for DNV ever since it opened its first office in India back in 1972.