India’s Great Eastern Shipping Company Ltd, the largest private fleet owner, has established a unit in the International Financial Services Centre at GIFT City to focus on ship leasing activities amidst government efforts to increase Indian tonnage. The GIFT City in Gujarat is India’s first International Financial Services Centre under the Special Economic Zone Act. The company approved the creation of a wholly owned subsidiary in IFSC-GIFT City with an authorized equity share capital of Rs 50 crores.
By setting up operations in IFSC-GIFT City, The Great Eastern Shipping Company has become the first member of the Indian National Shipowners Association to do so. The move aims to address the competitive challenges faced by fleet owners operating under the domestic tariff area regime and aims to bolster Indian tonnage. The company aims to benefit from tax incentives such as tax holidays, exemptions from capital gains and GST, stamp duty exemptions, and more.
The Indian shipping industry has faced challenges in terms of growing Indian-flagged tonnage, leading to a significant portion of international cargoes being carried on foreign-flagged ships. The move to establish a unit in the IFSC at GIFT City is seen as a strategic step to enhance Indian tonnage and address competitive disadvantages in taxation and finance. The efforts aim to support the economic and environmental interests of India by promoting the growth of Indian tonnage and ensuring a level playing field for Indian ship owners amidst global competition.
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