Cabinet okays scheme to provide Rs 1,624 cr over 5 yrs as subsidy to Indian shipping companies

The Union Cabinet on Wednesday approved a scheme to provide Rs 1,624 crore over five years as subsidy to Indian shipping companies in global tenders floated by ministries and CPSEs for import of government cargo, an official statement said.

According to the statement, registration shall be done online within 72 hours like the world's best ships registries and this will make it easy and attractive to register ships in India and thereby aid in boosting the Indian tonnage.

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"In addition to this, it is intended to provide 30 days to any in-flagging vessel to replace the crew on board with Indian crew," it added.

In order to address the cost disadvantage suffered by Indian flag ships, Finance Minister Nirmala Sitharaman has in her Union Budget for 2021-22 speech had announced a scheme providing Rs 1,624 crore over five years to promote flagging of merchant ships in India by providing subsidy support to Indian shipping companies in global tenders floated by ministries and CPSEs.

The statement said steps are also being taken to rationalize the manning requirements on the ships by aligning them with international standards.

It pointed out that despite having a 7,500 km long coastline, a significant national exim trade that is steadily growing on an annual basis, a policy of 100 per cent FDI in shipping since 1997 and Indian shipping industry and India's national fleet is proportionately small when compared with its global counterparts.