Lok Sabha Question No. 504 (UNSTARRED), answered on 2015-07-23
Subject: Indian Merchandise Trade
Ministry: SHIPPING
Asked by: B. SREERAMULU

## GOVERNMENT OF INDIA MINISTRY OF SHIPPING

## LOK SABHA UNSTARRED QUESTION NO.504 TO BE ANSWERED ON 23 RD  JULY, 2015

## INDIAN MERCHANDISE TRADE

## 504.   SHRI B. SRIRAMULU:

Will the Minister of SHIPPING be pleased to state:

- (a) the quantum and percentage of Indian merchandise trade carried on Indian and foreign vessels separately during each of the last three years and the current year;
- (b)    whether the quantum of said trade carried on foreign vessels is considerably higher than that carried on Indian vessels;
- (c)     if so, the details thereof alongwith the reasons therefor; and
- (d)    the steps being taken by the Government to increase the share of indian vessels in the trade?

## ANSWER

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

- (a)  to  (c):  The  Indian  merchandise  trade  carried  on  Indian  and  foreign  vessels  during  the  last three years are as under:

| Year    |   Quantity carried on Indian vessels (In Thousand MT) |   %share |   Quantity carried on Foreign vessels (In Thousand MT) |   %Share |   Total Quantity (In Thousand MT) |
|---------|-------------------------------------------------------|----------|--------------------------------------------------------|----------|-----------------------------------|
| 2011-12 |                                                 82086 |    10.87 |                                                 672783 |    89.13 |                            754869 |
| 2012-13 |                                                 70227 |     9.10 |                                                 701531 |    90.90 |                            771758 |
| 2013-14 |                                                 68940 |     8.50 |                                                 742165 |    91.50 |                            811105 |

Although  the  tonnage  tax  regime  provided  relief  to  Indian  shipping  companies  from corporate  tax,  Indian  shipping  companies  are  not  cost  competitive  with  foreign  shipping companies due to several other indirect and direct taxes.

- (d):     In order to encourage  the Indian shipping companies  to own  more  vessels, the Government has initiated several measures such as:-
*       Government has exempted Customs and Excise Duty leviable on bunker fuels used in Indian flag vessels for transportation of EXIM 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.
*        Government has taken a policy decision to allow shipping enterprises based in India to acquire ships abroad and also flag them in the country of their convenience.
*        Acquisition of all type of ships has been brought under the Open General Licence (OGL).
*        To attract  investment  for  the  growth  of  this  sector,  the  Government  has  allowed  100%  Foreign Direct Investment (FDI) in the shipping sector.
*        With a view to provide a level playing field to the Indian shipping industry, the government has introduced Tonnage Tax System.

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