The Coastal Shipping Act, 2025

Summary of Coastal Shipping Act, 2025

The Coastal Shipping Act, 2025 is a landmark piece of maritime legislation enacted in August 2025. It replaces the outdated Part XIV of the colonial-era Merchant Shipping Act, 1958, establishing a modern, dedicated legal framework to govern India's coastal shipping sector.

Primary Objectives

• Modernization & Growth: To streamline and update laws governing coastal trade, aiming to increase coastal cargo movement to 230 million metric tonnes by 2030.

• Self-Reliance and Maritime Security: To build a robust, citizen-owned and operated coastal fleet supporting the visions of Aatmanirbhar Bharat (Self-Reliant India) and Viksit Bharat (Developed India).

• Ease of Doing Business: To ease regulatory compliances, remove redundant barriers, and promote domestic participation in the maritime sector.

• Supply Chain Efficiency: To lower domestic logistics costs and integrate coastal shipping seamlessly with inland waterways.

Key Provisions

1. Simplified Licensing Framework

• Exemptions for Indian Vessels: Vessels wholly owned by Indian citizens or entities are exempted from licensing requirements, drastically reducing compliance burdens and operational delays.

• Regulation of Foreign Vessels: While domestic ships face fewer barriers, strategic regulatory control and mandatory licensing are retained for foreign vessels operating within Indian coastal waters.

2. Expanded Scope of Coasting Trade

• Unlike previous laws that narrowly defined coasting trade around cargo and passenger movement, the 2025 Act broadens the definition to include modern commercial activities such as marine exploration, offshore research, and specialized services.

• Covers a diverse range of watercraft, including ships, boats, sailing vessels, and mobile offshore drilling units (regardless of whether they are self-propelled).

3. National Coastal and Inland Shipping Strategic Plan

• Mandates the Central Government to formulate a comprehensive strategic roadmap (with biennial updates) to guide infrastructure development, route optimization, and operational efficiency across coastal and inland water networks.

4. National Database of Coastal Shipping

• Establishes a centralized, real-time national database to ensure data-driven governance, transparency, and accessible insights for potential investors and policymakers.

5. Strict Enforcement and Penalties

• Empowers the Director General of Shipping with clear regulatory oversight to issue directives concerning coastal security.

• Introduces strict enforcement measures—including the detention of vessels—for severe violations, such as operating without a required license, furnishing false data, or defying official instructions.