Government unveils plan to expand merchant fleet
The government plans to add 100 more vessels to India's merchant fleet over the next five years, Shipping Minister Sarbananda Sonowal said on Tuesday, a move aimed at reducing the country's freight bill. India currently has a merchant fleet of 1,600 seagoing ships, and the expansion is intended to cut the estimated USD 75 billion spent annually on freight charges to foreign shipping lines.
Sonowal was speaking at a press conference after the Sagar Samvad event, where the National Shipping Board (NSB) proposed a five-point roadmap to achieve the fleet expansion. The NSB, established in 1958, is tasked with ensuring that India's shipping policy is formulated after listening to the voices of those who sail, own, and fund the industry.
The rollout is part of a broader effort to reduce India's dependence on foreign shipping lines for transporting critical cargo such as crude oil, gas, coal, and urea.
The five-point roadmap
According to the NSB, the roadmap includes fiscal reforms, assured cargo support, access to competitive financing, regulatory streamlining, and improved ease of doing business. The proposals were discussed at the inaugural Sagar Samvad event on Monday, themed 'Charting the Roadmap Towards Maritime India Vision 2030 and Maritime Amrit Kaal Vision 2047'.
Sonowal, who chaired the event, welcomed the roadmap and said the measures would help Indian shipowners participate in the country's expanding maritime economy. "Taken together, these are not five separate asks; they are the architecture of a nation choosing, at last, to own its own trade," he said.
The roadmap supports the government's ambition of making India one of the world's top five ship-owning nations by 2047 under the Maritime Amrit Kaal Vision.
Cost disadvantages for Indian shipping
Despite the push for expansion, Indian shipping faces significant cost disadvantages. Panelists at a session on 'Augmentation of Indian Tonnage — Opportunities and Challenges' pointed out that operating under the Indian flag remains 16% to 20% costlier than operating under foreign flags. They attributed the cost differential to taxes on ship imports and maintenance services, taxation of seafarers' wages and freight, and higher domestic financing costs — expenses foreign competitors do not carry.
Under the sector's Right of First Refusal mechanism, Indian owners are expected to match foreign freight rates to win cargo. This mechanism, combined with the cost gap, creates a challenging environment for domestic tonnage expansion.
Officials emphasize self-reliance and employment
Union Minister of State Shantanu Thakur said India could not depend on foreign shipping lines to secure its trade routes, stressing the need to strengthen domestic tonnage.
Sonowal also highlighted the potential of the maritime sector as a major employment engine for the young workforce, positioning India as a leading supplier of skilled seafarers. "We are expanding quality training capacity, with steps taken to strengthen industry-led skilling, create wider employment pathways, address gender disparity and equip our workforce with skills for emerging segments such as cruise shipping and advanced shipbuilding," he said.
Union Minister Mansukh Mandaviya emphasized leveraging global demand for maritime professionals, calling for coordinated efforts among government, industry, trade bodies, and training institutions to address gender disparity and develop specialized talent.
Sonowal also acknowledged the success of the Container Manufacturing Assistance Scheme worth Rs 10,000 crore, with global shipping major Maersk now ordering containers built on Indian soil.