Outlook bright for Indian shipping

Creation of the ITT and implementation of similar such projects will help India emerge as a major shipping hub in the Indian Ocean.

Unlike other sectors, shipping is a global industry i.e. freight rates, demand for tonnage and profitability are closely linked to the progress in global trade. With the implementation of tonnage tax in the previous Budget, Indian shipping companies' profitability is likely to improve. These companies will now have greater resources (read cash) in their books in order to finance their fleet expansion programs. Overall, we are positive about the prospects of the Indian shipping industry due to expectations of growth in global trade going forward.

Indian National Shipowners' Association (INSA) Wish List

Customs duty exemption for imported ship spares and ship repair equipments

Exemption for certain categories of vessels from 5 per cent customs duty

Indian seafarers working on Indian ships should get equal income-tax

Increase in amount transferred to special reserves for capacity expansion.

Shipping companies out of MAT purview.

Corporatisation of major ports.

The government has allocated Rs 110 bn towards renovation/modernisation of airports and ports.

Dividend tax removed at the hand of the shareholders.

Concessional regime under Section 33AC to be withdrawn and companies to be granted option to pay tonnage tax or normal corporate tax on profits.

Setting up of an International Container Trans-shipment project at Kochi.

Service tax has been raised from 8 per cent to 10 per cent. Further, a surcharge of 2 per cent on account of education cess will be imposed on this tax.