Coastal Shipping Bill, 2024

Context:
The Union Ministry of Ports, Shipping and Waterways introduced the Coastal Shipping Bill, 2024 to promote coastal trade and increase participation of Indian-flagged vessels owned and operated by Indian citizens. This step aims to address national security and commercial requirements, reflecting the government's intent to modernize and regulate the maritime sector more effectively.

Background:

Coastal shipping refers to the transportation of goods and passengers along the Indian coastline, spanning 7,517 kilometers within territorial waters. This form of transport plays a vital role in global supply chains and the Indian economy.

• Ports in India:

  • Major ports are under the Central Government’s direct control.

  • Minor/intermediate ports are managed by State Governments.
    However, coastal shipping has been regulated by outdated laws like the Coasting Vessel Act of 1838 and Merchant Shipping Act of 1958, which lack uniformity.

Significance of Coastal Shipping:

• Energy-efficient & Cost-effective:
  Coastal shipping is ideal for bulk cargo, reducing dependency on road and rail transport, thereby alleviating congestion and lowering environmental impact.

• National Security:
  It supports logistical operations during national emergencies or security challenges, enhancing India's strategic capabilities.

Key Provisions of the Coastal Shipping Bill, 2024:

1. Simplified Licensing:

   • Removal of General Trading License for Indian-flagged vessels engaged in coastal trade, simplifying regulations and encouraging participation.

2. National Database:

   • A National Database for coastal shipping will be established to ensure transparency and efficient information sharing.

3. Strategic Plan:

   • A National Coastal and Inland Shipping Strategic Plan will be prepared to drive the development and growth of the coastal shipping sector.

4. National Security Focus:

   • The Bill mandates that coastal trade be primarily conducted by Indian-flagged vessels, owned and operated by Indian citizens, enhancing national security.

5. Inland Vessels Participation:

   • Inland vessels will be allowed to participate in coastal shipping under certain conditions, expanding the pool of vessels that can engage in the sector.

6. Environmental Standards:

   • The Bill includes provisions to ensure compliance with environmental regulations, supporting sustainable development of coastal shipping.

7. Penalties & Enforcement:

   • Penalties will be introduced for non-compliance, and authorities like the Director-General of Shipping will be empowered to enforce regulations.

8. Job Creation:

   • By prioritizing Indian-flagged vessels and Indian crew, the Bill aims to generate substantial employment opportunities in the maritime sector.

Implications:

• The Bill is poised to enhance national security by boosting the use of Indian-flagged vessels.

• It aims to modernize and streamline the regulatory framework, reducing bureaucratic hurdles and fostering transparency.

• The focus on job creation and Indian crew could help in strengthening India’s maritime workforce.

Updates on India’s Port and Maritime Sector:

1. Sagarmala Scheme:

   • Ongoing development of port infrastructure and coastal shipping.

2. Sagar Manthan:

   • Digital platform for providing data about the Ministry and its organizations.

3. National Waterway-4 (NW-4):

   • Operational Roll-on/Roll-off (Ro-Ro) services, primarily for stone chip transportation.

4. National Logistics Portal (Marine):

   • A one-stop platform for connecting all logistics stakeholders, improving efficiency and transparency.

5. SAGAR-SETU Mobile App:

   • Introduced to enhance ease of doing business in the maritime sector.

6. Vadhavan Major Port Project:

   • ₹76,220 crore investment approved for a major port development.

7. Maritime Amrit Kaal Vision 2047:

   • Focus on building world-class ports and promoting coastal shipping and inland water transport.

Challenges:

Despite its potential, coastal shipping faces challenges such as:

• Inadequate Infrastructure: Many ports require modernization to handle growing traffic.

• Regulatory Bottlenecks: Outdated laws and complicated processes hinder smooth operations.

• Competition: Coastal shipping faces competition from other transportation modes like road and rail, which are often preferred due to greater accessibility.

Way Ahead:

1. Infrastructure Development:
   Focus on upgrading existing ports and building new ones is essential for the sector's growth.

2. Policy Support:
   Continued policy incentives, including subsidies and incentives for shipbuilding and maintenance, will be crucial to attracting investment and players into the sector.

3. Public-Private Partnerships (PPP):
   Collaborative ventures between the government and private sector can aid in the development of infrastructure and enhance service delivery in coastal shipping.

Conclusion:

The Coastal Shipping Bill, 2024 presents an opportunity to modernize India’s maritime industry, with far-reaching benefits in terms of national security, job creation, and economic growth. However, its success will depend on addressing existing infrastructure gaps, improving regulatory frameworks, and encouraging private sector involvement.