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India’s Coastal Shipping Bill, 2025: A Game-Changer for Maritime Infrastructure and Trade
On August 7, 2025, the Rajya Sabha passed the Coastal Shipping Bill, 2025 via a voice vote, despite mounting protests from Opposition MPs demanding a discussion on the Special Intensive Revision (SIR) of electoral rolls in Bihar. Earlier, this landmark legislation had already been approved by the Lok Sabha on April 3, 2025.
What the Bill Enacts
This bill replaces Part XIV of the Merchant Shipping Act, 1958, introducing a contemporary legal framework aligned with global cabotage practices and tailored to India’s strategic needs.
Key Provisions:
- Excising license requirements for Indian‑flagged vessels, significantly reducing their compliance burden and fostering ease of doing business.
- Imposing licensing requirements on foreign-flagged vessels—including barges and mobile offshore units—engaging in India’s coasting trade, enforceable by the Directorate General of Shipping.
- Granting the DG Shipping authority to impose conditions during licensing—such as Indian crew quotas or domestic shipbuilding mandates—to bolster local industry and employment.
- Setting in motion the development of a National Coastal & Inland Shipping Strategic Plan within two years of the Act’s commencement.
- Mandating the creation of a National Database for Coastal Shipping, designed to provide real-time, transparent information to investors and policymakers.
- Classifying certain regulatory breaches—like operating without a license—as punishable by vessel detention or monetary penalty, rather than criminal prosecution.
Strategic Goals and Economic Rationale
Union Minister Sarbananda Sonowal characterized the bill as a “radical step” integral to achieving Maritime India Vision 2030 and Maritime Amrit Kaal Vision 2047.
The legislation aspires to boost India’s coastal cargo share to 230 million metric tonnes by 2030, leveraging its 11,098 km coastline that spans nine coastal states and four union territories. This initiative supports the broader framework of Aatmanirbhar Bharat and Viksit Bharat, aiming to foster domestic job creation, reduce foreign exchange leakage, and stimulate sustainable economic development.
The bill is projected to enhance logistics efficiency, alleviate road and rail congestion, lower carbon emissions, and optimize supply chains by shifting bulk transport to greener coastal routes.
Political Dynamics and Legislative Context
Though the bill promises transformative benefits for maritime infrastructure, lawmakers witnessed intense floor protests. Opposition MPs demanded attention to Bihar’s electoral roll revision (SIR), creating a charged atmosphere as the bill advanced via voice vote.
Still, its swift progression signifies the government’s ambition to reform India’s shipping governance framework. Notably, the Parliament has now approved three major maritime-focused reforms—the Merchant Shipping Bill, 2025, the Carriage of Goods by Sea Bill, 2025, and now the Coastal Shipping Act, 2025—marking a robust modernization agenda.
Impacts and Sectoral Opportunities
- Domestic Fleet Expansion: Indian entrepreneurs will find it easier to charter or operate indigenous vessels, driving fleet expansion and reducing reliance on foreign players.
- Shipbuilding & Employment: Licensing stipulations for foreign vessels that include Indian build or crew quotas could invigorate both domestic shipbuilding and employment in maritime sectors.
- Policy Coherence: The strategic plan and data infrastructure aim to enable long-range policymaking, route optimization, and incentive structures—important for both state-level planning and investor confidence.
- Sustainability: Coastal shipping offers a greener alternative to land-based transport modes, aligning with environmental goals while unlocking cost efficiencies.
- Regional Development: Enhanced connectivity can spur economic growth in coastal and riverine districts, supporting regional development under inclusive federalism.
In Summary
The Coastal Shipping Bill, 2025 is poised to revolutionize India’s coastal transport ecosystem. By removing licensing hurdles for Indian vessels, regulating foreign participation, enabling strategic planning, and fostering transparency, it lays the foundation for a modern, efficient maritime infrastructure.
The bill’s far-reaching potential—from scaling coastal cargo to promoting domestic industry, reducing logistics costs, ensuring greener transport, and supporting national ambitions of self-reliance—marks it as a cornerstone of India’s maritime future.
While its passage stirred political contention, the legislation ultimately emerges as a forward-looking reform that could reshape how India leverages its coastline for sustainable growth and global competitiveness. Let me know if you’d like a breakdown of specific provisions or insights on how coastal regions may benefit next.
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