Coastal Shipping Bill, 2024: A Game-Changer for India’s Maritime Sector and Logistics

The Coastal Shipping Bill introduces several important provisions aimed at simplifying and streamlining India’s coastal trade regulations.

The Lok Sabha recently passed the Coastal Shipping Bill, 2024, a landmark piece of legislation set to redefine India’s maritime and logistics sectors. By establishing a comprehensive legal framework for coastal trade, the bill aims to enhance the efficiency and sustainability of the nation’s transportation systems. This move, backed by the government’s larger vision of decongesting the road and rail networks, promises to unlock the full potential of India’s vast coastline, making coastal shipping a crucial mode of transportation for the country’s future growth.

Transforming Coastal Shipping for Economic Growth

Union Minister of Ports, Shipping and Waterways, Shri Sarbananda Sonowal, emphasized that the Coastal Shipping Bill, 2024 is a future-ready legal framework aimed at reducing India’s dependency on foreign vessels, boosting the development of a domestic coastal fleet, and encouraging Indian shipbuilding. The bill seeks to position coastal shipping as a cost-effective, environmentally friendly, and reliable mode of transportation that aligns with Prime Minister Narendra Modi’s broader National Logistics Policy.

The passage of the bill represents a significant shift toward integrating coastal shipping into India's national transport vision. Notably, it brings a modernized approach to coastal trade regulation, aligning it with global standards, and builds on the success of the government’s earlier maritime reforms.

Key Provisions of the Coastal Shipping Bill, 2024

The Coastal Shipping Bill introduces several important provisions aimed at simplifying and streamlining India’s coastal trade regulations. One of the main highlights is the removal of the general trading license requirement for Indian ships, drastically reducing compliance burdens and improving the ease of doing business in the sector. Foreign vessels are now allowed to operate in India’s coastal trade only under a licensing system enforced by the Director General of Shipping, ensuring that Indian shipbuilding and employment for seafarers are prioritized.

The bill also mandates the creation of a National Coastal and Inland Shipping Strategic Plan, which will be revised biennially to improve route planning, forecast traffic, and promote the integration of coastal shipping with inland waterways. This provision ensures long-term growth and sustainability for the coastal shipping sector and helps coordinate operations across different states.

Additionally, the bill outlines a National Database for Coastal Shipping, ensuring better transparency, coordination, and data-driven decision-making. This is a crucial move for facilitating smoother operations and fostering accountability in the sector.

Promoting Sustainable Transport and Reducing Logistics Costs

The integration of coastal shipping into India’s logistics network holds immense promise for reducing the country’s logistics costs, which have traditionally been high due to over-reliance on road and rail transportation. Coastal shipping is not only cost-effective but also a greener alternative, reducing emissions compared to other modes of transport. As part of the government’s push for sustainability, the bill includes provisions for promoting green clearance channels for coastal vessels.

The bill also addresses the surge in coastal cargo traffic, which has seen a remarkable increase of 119% over the past decade. From 74 million tonnes in 2014-15, the sector now handles around 162 million tonnes of cargo, with a target of reaching 230 million tonnes by 2030. The passing of this bill is seen as an essential step in meeting these ambitious targets while reducing the pressure on India’s already overburdened roads and railways.

Enhancing India's Maritime Security and Self-Sufficiency

A key objective of the Coastal Shipping Bill is to foster greater self-sufficiency in maritime operations. By reducing dependence on foreign vessels and encouraging the growth of an Indian-owned fleet, the bill supports India’s maritime security and reduces reliance on external sources for essential trade services. This aligns closely with the government’s Atmanirbhar Bharat initiative, which seeks to build a more self-reliant India across all sectors.

The bill further aims to create thousands of jobs in the maritime industry, spanning shipbuilding, port services, and ship operation. This is expected to drive economic growth and generate employment in coastal states and areas that rely heavily on maritime activities.

Strengthening Cooperative Federalism

A standout feature of the Coastal Shipping Bill, 2024 is its commitment to cooperative federalism. The bill ensures that states and union territories have active representation in the decision-making processes surrounding coastal and inland shipping operations. A committee comprising representatives from major ports, state maritime boards, and experts will play a central role in drafting the National Coastal and Inland Shipping Strategic Plan, ensuring that the interests and aspirations of regional stakeholders are reflected in national policy.

In states like Odisha, Goa, and Karnataka, the bill is expected to accelerate the development of local economies by providing an efficient and sustainable means of transport that connects coastal and inland waterways. The integration of these two sectors promises to foster inclusive growth, contributing to regional development while supporting the vision of Sabka Saath, Sabka Vikas.

Future Prospects and Global Standards

The Coastal Shipping Bill, 2024 is also poised to bring India in line with international best practices for coastal trade. By simplifying procedures, reducing unnecessary regulatory burdens, and improving infrastructure, the bill paves the way for more robust competition within the maritime industry. It seeks to increase the competitiveness of India’s coastal shipping industry while ensuring compliance with environmental standards, making it an attractive sector for investment.

As India seeks to position itself as a global maritime power, this bill is seen as an essential step in the country’s long-term strategy. By modernizing the regulatory framework for coastal shipping, India is setting the stage for a more integrated, sustainable, and competitive maritime sector that will play a pivotal role in the nation's economic growth over the next several decades.

 

The Coastal Shipping Bill, 2024 is more than just a regulatory overhaul—it is a blueprint for transforming India’s maritime and logistics infrastructure into a future-ready, sustainable, and efficient network. With its forward-thinking provisions, the bill aims to reduce logistics costs, foster job creation, enhance national security, and promote environmental sustainability. By leveraging India’s vast coastal potential, the bill is poised to become a cornerstone of the nation’s growth, contributing significantly to the achievement of its economic and developmental goals.

With the Coastal Shipping Bill, 2024 now passed, India’s maritime sector is poised for a bright future, ready to compete on the global stage and meet the evolving needs of the modern economy.