Parliament recently passed the Coastal Shipping Bill 2025 to boost India’s coastal economy.

• India’s 11,098 km long coastline, spanning nine coastal states and four Union territories, holds immense economic potential. 
• The Coastal Shipping Bill, 2025 is set to unlock this potential, modernizing the framework governing coastal shipping and transforming the maritime landscape.

Key Goals of the Coastal Shipping Bill 2025

1. Boost Coastal Cargo Movement: The Bill targets an increase in India’s coastal cargo share to 230 million metric tonnes by 2030, fostering the growth of domestic shipping along India’s coastline.

2. Reduce Dependence on Foreign Vessels: By increasing the role of Indian ships in domestic trade, the Bill aims to cut down reliance on foreign vessels, which will help retain foreign exchange within the country.

3. Promote Economic Growth and Employment: Expected to create jobs, particularly in coastal regions, and improve logistics efficiency, thus stimulating overall economic growth.

4. Strengthen the Maritime Sector: Simplifies regulations, offering a level playing field for domestic shipping operators, thereby enhancing competitiveness within the sector.

Main Features of the Coastal Shipping Bill 2025

• Repeal of Part XIV of the Merchant Shipping Act, 1958: The Bill replaces Part XIV of the Merchant Shipping Act, 1958, which regulates coastal shipping, with modern, progressive legislation aligned with global cabotage standards.
• Comprehensive Vessel Coverage: The Bill regulates all types of vessels, including ships, boats, sailing vessels, and mobile offshore drilling units, whether self-propelled or not.
• Powers to Exempt: The central government has the authority to exempt any class of vessels from the application of the Bill.
• Simplified Licensing: The Bill introduces easier licensing processes for coastal shipping, lowering barriers for entry into the market. Licensing will be issued by the Director General of Shipping, appointed by the central government.
• Coasting Trade Expanded: The Bill broadens the definition of coasting trade to include services such as exploration, research, and any commercial activities, excluding fishing. These services will now be governed by the same regulations.
• Regulation of Foreign Vessels: Clear guidelines for foreign vessels engaging in domestic cargo movement, providing greater control over international competition in India’s coastal waters.
• Penalty Revision: The Bill revises penalties for engaging in coasting trade without a license. The new maximum fine is set at ₹15 lakh or four times the gains from an unlicensed voyage, whichever is higher (up from a previous fine of ₹1,000).
• National Coastal and Inland Shipping Strategic Plan: A long-term policy and infrastructure roadmap will be developed to guide the future of coastal and inland shipping in India.
• National Database for Coastal Shipping: The Bill mandates the creation of a real-time, transparent database, providing authentic data for investors and stakeholders, fostering greater confidence in the sector.

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