- Meaning: Global ship owners would register their ships in India. These Ships would fly Indian Flag and would be involved in both international trade and Coastal Trade.
- Rationale: Presently foreign owned vessels account for almost 92% of India's cargo. Hence, need to ensure that more ships are registered in India.
- Benefits for Flagging Ships in India: No global tender for the procurement of services below the value of Rs 200 crores. So, the preference would be given to domestically registered ships.
Other Shipping Related Terms in News
Cabotage Rules:
Cabotage refers to the movement of goods between the two ports in the same country. Earlier, the Government had allowed only the Indian-flagged vessels to involve in Cabotage operations. In May 2018, the shipping Ministry eased the Cabotage rules to enable the foreign-owned vessels to perform cabotage operations without the need for special approval.
Right-of-First Refusal:
This policy has been unveiled by the shipping Ministry to give higher preference to the Indian vessels. Under this policy, if a tender for the movement of cargo has been awarded to a foreign registered vessel based upon the bidding, then the entity owning the Indian-registered vessel can bag the same contract by paying the lowest bid amount.