Latest news with #Indian-flagged
Time of India
10-07-2025
- Business
- Time of India
Shipping ministry seeks duty cuts for tax parity with foreign flagged ships
New Delhi: The shipping ministry has sought a reduction in duties and taxes on domestic-flagged ships by bringing tax parity between them and vessels registered abroad. Officials said the issue is being discussed with the finance ministry and a proposal for tax parity will be sent soon. "A committee is assessing the taxation issues raised by the Indian shippers and ship owners," a senior official told ET. India's shipping fleet comprises 1,552 domestic-flagged vessels, including Indian controlled tonnage, with a total of 13.65 million gross tonnage. Sector watchers said while these ships are flagged in India, they face around 20% higher costs compared with foreign vessels due to domestic levies. This puts pressure on their margins since most tenders in the maritime business are open for global competition. "The GIFT City (in Gujarat) provides a very attractive ecosystem for owning ships in India where there is a 10-year corporate tax holiday, no integrated goods and services tax ( IGST ) on import of ships, no GST on maintenance, repair and operation services," the official added. The proposed tax tweaks will supplement India's new plan to promote domestically-flagged ships after an existing scheme may miss its targets for the sector, hindering the government's aim to become a key player in global maritime trade . Domestic shipping industry representatives allege discrimination against them has compromised their viability. This is on account of IGST on Indian companies importing ships, blocked GST tax credits and discriminatory GST on Indian vessels providing services between two Indian ports-all of which are not applicable to foreign ships providing similar services. The domestic industry has been lobbying for lowering of these duties and taxes. India's efforts to boost its maritime industry are facing challenges, with a ₹1,624 crore subsidy scheme for Indian shipping companies launched in FY22 likely to fall short of its objectives. Despite the initiative, the share of cargo carried by Indian-flagged ships in imports remains stagnant at 8% since 2021. The scheme's limitations, such as excluding export and coastal carriage contracts, hinder its effectiveness. Moreover, Indian ships are often bypassed for fertiliser and crude oil imports due to unfavourable contract terms, the industry representatives said. Economic Times WhatsApp channel )
Time of India
07-07-2025
- Business
- Time of India
Shipping policy revamp: How Centre plans to promote domestically-flagged ships; 200 ships worth Rs 1.3 lakh crore in demand
This is an AI-generated image, used for representational purposes. The Indian government is drafting a fresh strategy to promote domestically-flagged ships, after its current Rs 1,624 crore scheme launched in FY22 has fallen short of its objectives. The scheme, which aimed to raise India's share of EXIM cargo carried by Indian ships, has not had the desired impact, with only Rs 330 crore disbursed so far and the share of Indian-flagged vessels still hovering around 8%, reported ET. To address this, the ministry of ports, shipping, and waterways (MoPSW) is holding inter-ministerial consultations with the petroleum, steel, and fertiliser ministries to assess sector-specific shipping needs. "This has resulted in demand for around 200 ships of 8.6 million Gross Tonnage (GT) worth around Rs 1.3 lakh crore which would be jointly owned by public sector companies and built in Indian shipyards over the next few years," MoPSW was quoted by ET. The new initiative aims to cater to the rising import needs of critical sectors like petroleum, steel and fertilisers. The effort comes as the share of Indian vessels in carrying India's EXIM trade has sharply dropped to 7.8% in FY19 from 40.7% in 1987-88. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Top Public Speaking Course for Children Planet Spark Book Now Undo This has translated into an annual foreign exchange outgo of nearly $70 billion to overseas shipping lines. Under the existing subsidy scheme, Indian shipping companies were offered up to 15% incentive when bidding for global tenders floated by the government and its agencies. These tenders typically involved imports of crude oil, LPG, coal and fertilisers. However, experts say the scheme has failed to achieve scale or impact. Anil Devli, CEO of the Indian National Shipowners Association, pointed to structural disadvantages faced by Indian-flagged ships and said, 'Nothing has happened to reduce this burden of duties and taxes on Indian ships that impairs their competitiveness,' he was quoted as saying by ET. Operating costs for Indian vessels are estimated to be 20% higher than their foreign counterparts due to multiple factors, including higher debt costs, shorter loan terms, and taxation on wages of Indian seafarers. Additionally, Indian shipping firms face GST on vessel imports, lack of input tax credits, and differential GST for services within Indian ports, taxes that are not levied on foreign-flagged ships offering the same services. As per the shipping ministry, Indian ports handled 1,540.34 million metric tonnes (MMT) of cargo in 2023-24, a 7.5% increase year-on-year. However, the absence of a competitive Indian fleet continues to undermine the government's ambition of transforming the country into a maritime powerhouse. With the existing scheme unlikely to meet its FY26 goals, a review is expected soon, and the government may now shift its focus to long-term public-private fleet creation involving Indian-built ships to capture a larger share of global shipping. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Economic Times
06-07-2025
- Business
- Economic Times
Fresh plan in the works to promote Indian ships for higher cargo share
India is preparing a new plan. This plan aims to boost Indian ships. The current scheme is likely to miss targets. The government wants to be a key maritime player. Consultations identify demand for 200 new ships. These ships are worth ₹1.3 lakh crore. The petroleum, steel, and fertiliser sectors need them. The goal is to increase Indian-flagged ships. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Popular in Transportation 1. Cochin Shipyard to partner with HD Korea Shipbuilding & Offshore Engineering in various domains New Delhi: India is readying a new plan to promote domestically-flagged ships after an existing scheme appears set to miss its targets for the sector, hindering the government's aim to become a key player in global maritime consultations have identified aggregated demand for about 200 new Indian ships worth ₹1.3 lakh crore required for imports by the petroleum, steel, and fertiliser sectors."Shipping Ministry is working with Ministries of Petroleum and Natural Gas, Steel, and Fertiliser to address the low imports on India flagged ships," the Ministry of Ports, Shipping, and Waterways (MoPSW) said, responding to queries from ET. "This has resulted in demand for around 200 ships of 8.6 million Gross Tonnage (GT) worth around ₹1.3 lakh crore which would be jointly owned by the public sector companies (PSUs) and built in Indian shipyards over the next few years," the ministry Centre's latest attempt to bolster the lineup of Indian-flagged merchant ships follows the high probability of the current ₹1,624 crore scheme to promote such vessels missing its goal. Maritime trade experts say the share of cargo carried by domestically-flagged ships in imports is still at around 8%, unchanged since 2021 when the scheme was launched."A review of the scheme is now expected but just ₹330 crore has been disbursed till now, and the share of Indian flagged ships remains in single digits," a senior official told ET. The scheme was announced in the FY22 budget and approved by the Union cabinet in July 2021. Funds were to be disbursed till FY26, providing up to 15% subsidy to Indian shipping companies participating in global tenders issued by the Centre and its arms. Sops were offered for importing government cargo such as crude oil, liquid petroleum gas (LPG), coal, and share of Indian vessels in the carriage of the country's export import (EXIM) trade plunged to about 7.8% in FY19 from 40.7% in 1987-88. As per official estimates, this led to around $70 billion annual foreign exchange outgo to foreign shipping lines. Indian ports handled around 1540.34 million metric tonnes (MMT) cargo in 2023-24, 7.5% higher than a year ships mandatorily employ Indian seafarers while also complying with domestic taxation and corporate laws, leading to 20% higher operating costs, according to official watchers say the increased operating costs is due to higher costs of debt funds, shorter loan tenures, and taxation on wages of Indian seafarers engaged on Indian vessels. There is also an integrated Goods and Services Tax (GST) on Indian companies importing ships, blocked GST tax credits, discriminatory GST on Indian vessels providing services between two Indian ports; all of which are not applicable to foreign ships providing similar services. The domestic industry has been lobbying for lowering of these duties and taxes."Nothing has happened to reduce this burden of duties and taxes on Indian ships that impairs their competitiveness," Anil Devli, CEO, Indian National Shipowners Association told ET.
Time of India
06-07-2025
- Business
- Time of India
Fresh plan in the works to promote Indian ships for higher cargo share
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel New Delhi: India is readying a new plan to promote domestically-flagged ships after an existing scheme appears set to miss its targets for the sector, hindering the government's aim to become a key player in global maritime consultations have identified aggregated demand for about 200 new Indian ships worth ₹1.3 lakh crore required for imports by the petroleum, steel, and fertiliser sectors."Shipping Ministry is working with Ministries of Petroleum and Natural Gas, Steel, and Fertiliser to address the low imports on India flagged ships," the Ministry of Ports, Shipping, and Waterways (MoPSW) said, responding to queries from ET. "This has resulted in demand for around 200 ships of 8.6 million Gross Tonnage (GT) worth around ₹1.3 lakh crore which would be jointly owned by the public sector companies (PSUs) and built in Indian shipyards over the next few years," the ministry Centre's latest attempt to bolster the lineup of Indian-flagged merchant ships follows the high probability of the current ₹1,624 crore scheme to promote such vessels missing its goal. Maritime trade experts say the share of cargo carried by domestically-flagged ships in imports is still at around 8%, unchanged since 2021 when the scheme was launched."A review of the scheme is now expected but just ₹330 crore has been disbursed till now, and the share of Indian flagged ships remains in single digits," a senior official told ET. The scheme was announced in the FY22 budget and approved by the Union cabinet in July 2021. Funds were to be disbursed till FY26, providing up to 15% subsidy to Indian shipping companies participating in global tenders issued by the Centre and its arms. Sops were offered for importing government cargo such as crude oil, liquid petroleum gas (LPG), coal, and share of Indian vessels in the carriage of the country's export import (EXIM) trade plunged to about 7.8% in FY19 from 40.7% in 1987-88. As per official estimates, this led to around $70 billion annual foreign exchange outgo to foreign shipping lines. Indian ports handled around 1540.34 million metric tonnes (MMT) cargo in 2023-24, 7.5% higher than a year ships mandatorily employ Indian seafarers while also complying with domestic taxation and corporate laws, leading to 20% higher operating costs, according to official watchers say the increased operating costs is due to higher costs of debt funds, shorter loan tenures, and taxation on wages of Indian seafarers engaged on Indian vessels. There is also an integrated Goods and Services Tax (GST) on Indian companies importing ships, blocked GST tax credits, discriminatory GST on Indian vessels providing services between two Indian ports; all of which are not applicable to foreign ships providing similar services. The domestic industry has been lobbying for lowering of these duties and taxes."Nothing has happened to reduce this burden of duties and taxes on Indian ships that impairs their competitiveness," Anil Devli, CEO, Indian National Shipowners Association told ET.
The Hindu
24-06-2025
- Business
- The Hindu
Maritime body sounds alarm on DG order on retiring 20-year-old ships, calls for urgent policy reforms
Over 700 Indian-flagged vessels, mostly operating in coastal and near-shore routes, are expected to be retired prematurely due to age-based restrictions being imposed by DG Shipping, said officials of International Maritime Federation (IMF). The move would render over 20,000 seafarers jobless and impact the livelihood of more than one lakh people, they said. Shipping industry leaders, seafarer advocates, shipowners, policy experts, and technology officers under the banner of IMF on Tuesday called for urgent policy reforms for the survival of the sector. They were objecting DG Shipping's Order 6/2023 on vessel-age norms and the penalty mechanisms imposed on Recruitment and Placement Services Licence (RPSL) companies. According to IMF officials, as per the DG Shipping Order, 20-year-old ships will be scrapped. 'The blanket ban on age of the ship and disproportionate RPSL penalties are not just operational hurdles, they are existential threats to India's maritime ecosystem' said Capt. Nalin Pandey, CMD-Pentagon Marine. IMF officials said a comprehensive global dataset of over 1,30,000 commercial vessels and 3,70,000 inspections found that older vessels, especially those that have operated safely for over 25 years, often demonstrate better safety records than newer ships. 'This is attributed to rigorous maintenance practices and survivorship bias, older ships that are still operational tend to be inherently more robust and better maintained,' they added. Capt. Ramji S. Krishnan, a Sloan Fellow from London Business School, said 'The world does not sail by age, it sails by condition. If our classification societies and safety inspections say a ship is fit, then who are we to call it unfit just because it is old?' Officials said if age norms threaten the vessels, DG Shipping's RPSL penalty framework threatens the recruiters who connect Indian seafarers to ships. Capt. Raj Sinha, Chairman, Marine Solutions also Ex Chairman (IMF) said instead of a consultative mechanism, RPSL companies are penalised, blocked on portals, and fined heavily, often without the opportunity for appeal. IMF officials said the phasing out of over 700 older vessels would create a capacity vacuum that cannot be filled quickly or cheaply and foreign flagged vessels will fill the gap. The IMF has called for replacement of age norms with safety and maintenance-based standards, withdrawal of revision of Order 6/2023, pending transparent consultation, introduction of a 3-strike graded penalty system for RPSL firms and creation of a centralized grievance redressal and appeals mechanism among others.
