India Maps 100-Ship Fleet Expansion to Cut Its $75 Billion Freight Bill

India is moving to expand its national fleet through a reconstituted National Shipping Board, reformed under the Merchant Shipping Act of 2025 and advising the Ministry of Ports, Shipping and Waterways.

At a day-long conference chaired by Minister of Shipping Sarbananda Sonowal, shipowners, financiers, government officials and maritime cadets discussed adding up to 100 vessels to the Indian fleet over five years. The stated aim is to reduce dependence on foreign-flag shipping and to bring down freight costs.

The scale of that dependence is the driver. India spends roughly $75 billion a year on freight charges to foreign shipping lines for essential cargoes including crude oil, gas, coal and urea. Operating under the Indian flag currently costs 16 to 20 percent more than the foreign alternative, a gap built from import taxes on ships, service taxes on maintenance, taxation of seafarer wages, freight taxes and higher domestic capital costs.

That is not a performance problem, said Shantanu Thakur, Union Minister of State for Ports, Shipping and Waterways. It is a competitiveness and demand-partnership problem.

The government has set out a five-pillar roadmap covering fiscal reform, assured cargo support, access to competitive financing, regulatory streamlining and ease of doing business. Assured cargo support is the pillar with the most immediate commercial weight, since it would give Indian-flag owners a volume base against which to finance tonnage.

The programme sits inside a broader national target of quadrupling port capacity to 10,000 million tonnes by 2047 and placing India among the world's top five ship-owning nations. For now, the cost differential remains the binding constraint, and the tax structure behind it is what the board has been asked to unpick. Cargo that could move under the national flag continues to move under a flag of convenience instead.