By TIOL News Service

NEW DELHI, APR 04, 2025: THE Lok Sabha passed the Coastal Shipping Bill, 2024, paving the way for a dedicated legal framework for coastal trade as the maritime sector aims to provide a economical, reliable and sustainable mode of transportation as it decongest road and rail network. "The Bill seeks to unlock the full potential of India's vast and strategic coastline, providing dedicated legal framework for coastal trade," asserted Sarbananda Sonowal, Union Minister of Ports, Shipping and Waterways. 

The Coastal Shipping Bill, 2024 aims to make coastal trade easier, more competitive, and better integrated with PM Narendra Modi Govt's overall transport vision - the National Logistics Policy. With its manifold forward looking provisions, the bill provides a future ready legal framework while upgrading the dated provision of earlier legislations like Merchant Shipping Act, 1958. The proposed bill introduces key provisions for licensing and regulating foreign vessels in India's coasting trade. It mandates the formulation of a National Coastal and Inland Shipping Strategic Plan and establishes a National Database for Coastal Shipping. The bill also regulates foreign vessels chartered by Indian entities and outlines penalties for violations, aligning with the government's push for decriminalising laws. Additionally, it grants the Director General of Shipping authority to seek information, issue directions, and enforce compliance, while empowering the Central Government to provide exemptions and regulatory oversight, ensuring streamlined and efficient coastal shipping operations in India.

Speaking on the occasion, Union Minister Sarbananda Sonowal said, "The Coastal Shipping Bill aligns local aspirations with national goals, and provides a framework for the next 25 years of coastal economic growth under the Maritime Amrit Kaal Vision 2047. The overarching goal of the Bill to develop a coastal fleet owned and operated by Indian entities will lead to reduced dependence on foreign vessels for critical areas relevant for our country's coastal shipping. It will reduce logistics costs, promote green transport, support the vision of Prime Minister Narendra Modi ji's ‘Make in India' initiative and create thousands of jobs in shipbuilding, port services and manning of vessels. The bill is in line with international best practices for adopting dedicated law for coastal trade but adopted to suit Indian conditions. This Bill provides a dedicated legal framework to boost coastal trade, propelling inland waterways and riverine economies while offering a low-cost, reliable, and sustainable alternative to overloaded road and rail networks."

The Coastal Shipping Bill, 2024 aims to reduce logistics costs and promote sustainable transport. Coastal shipping, a cost-efficient and low-emission mode of transport, will play a key role in easing India's overburdened road and rail networks. Key provisions of the Bill include the removal of the general trading license requirement for Indian ships (Clause 3), reducing compliance burdens and enhancing ease of doing business. Foreign vessels can engage in coastal trade only under a license issued by the Director General of Shipping (Clause 4), with conditions that support Indian shipbuilding and employment for seafarers. The Bill mandates a National Coastal and Inland Shipping Strategic Plan (Clause 8), revised biennially, to improve route planning, forecast traffic, and integrate coastal shipping with inland waterways. This strategic vision ensures long-term growth and sustainability in India's maritime sector.

On the bill's efficacy with present day realities as well as its role as a future ready framework, the Union Minister of Ports, Shipping and Waterways, Sarbananda Sonowal said, "The new Coastal Shipping Bill modernises and streamlines coastal trade regulations, addressing gaps in the Merchant Shipping Act, 1958. Unlike its predecessor, which focused solely on vessel licensing, this Bill provides a forward-looking, holistic framework aligned with global cabotage practices. It simplifies procedures, promotes growth, & integrates coastal shipping into India's modern logistics network, ensuring efficiency, sustainability and competitiveness in the maritime sector."

The Coastal Shipping Bill, 2024 builds on key reforms, including prioritised berthing, green clearance channels, and GST reduction on bunker fuel. Coastal cargo traffic has surged 119% in the last decade, from 74 million tonnes in 2014-15 to 162 million tonnes in 2023-24, with a target of 230 million tonnes by 2030. The Bill ensures legal clarity, regulatory stability, and investment-friendly policies, strengthening India's maritime security and advancing the vision of Atmanirbhar Bharat.

On the possibilities froms trategic integration of coastal shipping with inland waterways, Sarbananda Sonowal said, "The integration of coastal and inland waterways will promote regional development of riverine and coastal areas alike in the country. This Bill will also give impetus to the long-term vision of development of coastal and inland waterways transport in States such as Odisha, Karnataka and Goa among others. The integration of coastal shipping routes with inland waterways - which often traverse multiple states - calls for collective planning and coordinated execution. By recognising the role of States in this regard, this Bill ensures that the growth of coastal shipping is inclusive and participative."

The Coastal Shipping Bill, 2024 introduces a National Database of Coastal Shipping to enhance transparency, coordination, and data-driven decision-making. It also expands the category of charterers allowed to hire foreign vessels, including Indian citizens, NRIs, OCIs, and LLPs. Ensuring cooperative federalism, the Bill provides active representation for States and Union Territories in key mechanisms, reinforcing India's commitment to a streamlined, inclusive, and efficient maritime sector.

Allaying criticism of the Opposition parties, the Union Minister asserted, "The Coastal Shipping Bill, 2024 upholds cooperative federalism by ensuring active participation of States and Union Territories. Under Clause 8(3), a committee-comprising representatives from major ports, State Maritime Boards, and experts-will draft the National Coastal and Inland Shipping Strategic Plan. This guarantees States a direct role in shaping strategy, routes, and regulations. By integrating coastal shipping with inland waterways, the Bill enables collective planning, fostering inclusive growth aligned with Sabka Saath, Sabka Vikas."