September 22, 2025: The Finance Ministry’s recent decision to grant infrastructure status to large commercial ships has been welcomed as a positive move. Still, it excludes nearly 500 coastal vessels, sparking concerns within the shipping industry.
As per the notification issued on September 19, Indian-owned and flagged commercial ships of 10,000 gross tonnage (GT) and above, or Indian-built, owned, and flagged vessels of 1,500 GT or more, will qualify for infrastructure status. This classification allows shipowners to access long-term, low-cost funding for fleet acquisition.
However, the criteria exclude many smaller vessels, including tugs, dredgers, and offshore support vessels, which play a vital role in cargo movement, port operations, and the offshore oil industry. India has around 1,500 ships under the Merchant Shipping Act, of which nearly 1,000 are coastal vessels. About half of these will not be eligible for benefits under the current framework.
“After years of pursuing the government, what have we got? Nothing for coastal shipping,” said Rakesh Singh, President of the Indian Coastal Ship Owners’ Association. He added, “These vessels are the backbone of ports and the offshore oil industry and are an extension of ports and offshore infrastructure. Leaving them out defies logic.”
Shipowners and the Directorate General of Shipping had recommended a benchmark of 24 meters length or 500 GT for infrastructure status, but the Finance Ministry opted for higher thresholds. Singh noted that the criteria are “not in sync with the recently enacted Coastal Shipping Act” and also diverge from the government’s Maritime Vision 2030 and Maritime Amrit Kal Vision 2047.
Singh further pointed out that the exclusion contradicts Prime Minister Narendra Modi’s recent call to strengthen MSMEs to drive self-reliance. “The government is supporting MSME from every side and here the Finance Ministry has set a criterion which puts a big chunk of the coastal shipping sector out of the infrastructure benefit,” he said.
Source: ET Infra
