The Union government of India is set to introduce new rules for coastal shipping that will allow foreign vessels to operate in Indian coastal waters, effectively lifting the current Cabotage rules. The new rules will be announced by Prime Minister Narendra Modi and Shipping Minister Sarbananda Sonowal at the Global Maritime India Summit 2023. The government aims to increase the share of cargo movement through the coastal route while protecting the interests of local shipping lines. The new norms have been developed in consultation with the Indian shipping industry to provide opportunities for all parties to grow.
The new rules for coastal shipping align with the government’s policy of reducing logistics costs in the country. The aim is to increase the share of cargo movement through coastal shipping to 10% by 2025, up from the current 7%. By 2030, the government aims to transport 15-18% of India’s cargo through coastal shipping. Currently, the cabotage rules only allow Indian registered ships to ply on local routes carrying cargo.
The new rules for coastal shipping are expected to bring about increased efficiency and cost savings in the logistics sector. It will open up opportunities for international vessels to operate in Indian coastal waters, potentially leading to increased competition and improved services. This move is part of the government’s broader efforts to boost coastal shipping in India and reduce reliance on road and rail transportation.