The Indian government recently announced plans to revoke three critical orders issued in 2018, which had allowed foreign-flagged ships to transport specific cargo along domestic routes without a license from the Directorate General of Shipping (DGS). This decision represents a landmark shift, one that aligns closely with the Maritime Amrit Kaal Vision 2047—a long-term strategy to enhance India’s maritime sector. The revocation signals the government’s commitment to boosting India’s container shipping sector, reducing dependency on foreign liners, and setting the stage for a national container shipping line.

Revoking 2018 Orders: A Step Toward Maritime Self-Reliance

The 2018 orders were intended to facilitate smoother operations on India’s coasts by enabling foreign-flagged ships to engage in domestic cargo transportation without obtaining a DGS license. However, this led to stagnation within the Indian shipping sector. The move to cancel these orders aims to restore competitiveness and provide a regulatory environment that better supports Indian-flagged container vessels.

One key focus is the balance of market participation between large foreign players and Indian operators. Small and mid-sized domestic shipping companies are viewed as essential to sustaining a dynamic, competitive market that fosters innovation and affordable services. Policies that support smaller market players will help to prevent a monopolized shipping industry, which often leads to increased costs, reduced service quality, and diminished innovation.

Boosting the Indian-Flagged Container Fleet

Between 2013 and 2018, the number of Indian-flagged vessels showed gradual growth, contributing significantly to India’s maritime economy by providing jobs for Indian seafarers and strengthening the domestic supply chain. Unfortunately, since the introduction of the 2018 orders, this progress has reversed, and today, there are only about 30 container ships under the Indian flag. The upcoming revocation aims to reverse this trend, and with regulatory support and incentives, the Indian container fleet is expected to grow, promoting self-sufficiency and providing a platform for further sector innovation.

Exemptions for Vessel Sharing Agreements (VSAs)

In a parallel initiative, the Directorate General of Shipping is also considering an exemption for Vessel Sharing Agreements (VSAs) from India’s antitrust laws. If implemented, VSAs could be exempted for three years, subject to conditions such as reserving space on these vessels for Indian-flagged ships and non-vessel operating common carriers (NVOCCs). This exemption could increase the presence of Indian-flagged vessels within shared shipping agreements, thereby providing domestic operators with more access to international trade routes.

Vision for a Robust Maritime Future

India’s move to support its shipping industry is part of the broader Maritime Amrit Kaal Vision 2047, which outlines ambitious goals for the nation’s maritime sector. Central to this vision is the reduction of reliance on foreign liners, a goal that has been bolstered by calls from exporters for a national container shipping line. Such a line would serve to stabilize shipping costs for Indian exports, improve the efficiency of the supply chain, and build resilience in the face of global shipping disruptions.

State-controlled ports are at the forefront of this maritime expansion, with cumulative plans for capacity expansions worth over Rs 2 lakh crore. With a goal to reach a total cargo handling capacity of 10,000 million tonnes annually by 2047, these investments are geared to accommodate India’s increasing trade demands and to facilitate smoother logistics across various sectors.

Port Development Plans Across Key States

In line with the national vision, states like Gujarat and Andhra Pradesh are spearheading major development initiatives. Gujarat has outlined plans for port-centered urban growth, aiming to invest Rs 1.5 lakh crore to develop 10 greenfield ports and expand existing ones. These projects are expected to drive regional economic growth, improve infrastructure, and create a strategic hub for domestic and international trade.

Andhra Pradesh has also joined the development surge, proposing investments of Rs 50,000 crore by 2050. The state aims to triple its cargo-handling capacity and establish a new shipbuilding yard, demonstrating its commitment to supporting India’s maritime ambitions through regional initiatives.

Balancing Growth with Market Accessibility

The government’s strategies are designed to encourage both large-scale port infrastructure and small-scale market accessibility. By promoting participation from smaller shipping companies and ensuring fair competition, India’s maritime policy strives to create a well-rounded market that benefits industry stakeholders and keeps costs in check for consumers. These developments signal a new chapter for India’s maritime industry, characterized by strong support for Indian vessels, strategic alliances, and a significant emphasis on self-reliance.

In conclusion, the decision to revoke the 2018 orders and promote a national shipping line demonstrates a commitment to revitalizing India’s container shipping sector. Through regulatory reform, state investment, and infrastructure expansion, India’s maritime economy is poised for substantial growth, building a resilient foundation for India’s global trade ambitions by 2047.

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