Lok Sabha Question No. 2055 (UNSTARRED), answered on 2015-12-10
Subject: Problems in Shipping Industry
Ministry: SHIPPING
Asked by: CHANDRA PRAKASH JOSHI

## GOVERNMENT OF INDIA MINISTRY OF SHIPPING

## LOK SABHA UNSTARRED QUESTION NO.2055 TO BE ANSWERED ON 10 TH  DECEMBER, 2015

## PROBLEMS IN SHIPPING INDUSTRY

## 2055. SHRI CHANDRA PRAKASH JOSHI:

Will the Minister of SHIPPING be pleased to state:

## पोतप�रवहनमंत्

- (a) whether  the  Indian  Shipping  Industry  including  Shipping  Corporation  of  India  are  facing  grim situation due to Baltic Dry Index hitting new lows recently and if so, the details thereof;
- (b) whether the Indian National Ship-owners Association has put up a proposal to the government on this matter and if so, the details thereof and the response of the government thereto;
- (c) whether the Government proposes to make it mandatory for state-owned companies to allocate 50% of its cargo volumes for Indian - flagged ships;
- (d) if so, the details thereof and the time by which it is likely to be implemented; and
- (e) the other steps taken/being taken by the Government to boost the shipping industry in the   country?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF SHIPPING (SHRI PON. RADHAKRISHNAN)

- (a)&(b):  Baltic  Dry  Index  (BDI)    experienced  a  fall  from  a  high  of  1484  in  November,  2014  to  584  as  on November 30, 2015.   The Shipping Corporation of India (SCI) currently owns 17 Dry Bulk Carriers comprising about 25% of its own tonnage and profitability of the company has suffered due to present market condition.    The Indian Shipowers' Association (INSA) have approached the Government for tax incentives to shipping industry to enable creation of a level playing field.
- (c)&(d): Indian Shipping industry has been provided cargo support in the form of Right of First Refusal (RoFR) and  policy  of  Free  On  Board  (FOB)  import  is  being  followed  for  government  owned/controlled cargoes.      World  over  countries  are  securing  transportation  of  their  critical  cargoes  through  their national  shipping  fleet.  A  Note  has  been  circulated  by  Ministry  of  Shipping  to  user  Government Departments/Ministries on similar lines for their views.
- (e) To make the Indian shipping industry competitive, the Government has exempted Customs and Excise Duty leviable on bunker fuels used in Indian flag vessels for transportation of mix of EXIM, domestic and empty containers between two or more ports in India.  In the Union Budget 2015-16, Government has brought in a uniform abatement of service tax for transportation of goods by rail, road and sea vessels.  Indian  shipping  industry  has  been  provided  cargo  support  through  Right  of  First  Refusal (RoFR).  Besides this, Government has allowed shipping enterprises based in India to acquire ships abroad and also flag them in the country of their convenience.    As a step towards creating a climate of  'Ease  of  Doing  Business'  in  the  country,  methodology  for  computation  of  period  of  stay  of seafarers in India has been redefined.  The period of stay in India henceforth will be counted from the date entered into the Continuous Discharge Certificate (CDC) in respect of joining the ship by the said individual and ending on the date entered into the CDC in respect of signing off by that individual from the ship.

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