Global container giants target India’s Coastal Shipping market
NEW DELHI : Global Container Lines eye India’s Coastal Trade amid policy incentives and market potential. More global container shipping giants are preparing to enter India’s domestic coastal trade market, lured by policy reforms, infrastructure incentives, and the promise of growing cargo volumes driven by Asia’s manufacturing diversification.
Industry sources indicate that Maersk is advancing plans to launch coastal shipping services between Indian ports. “The carrier is keen to diversify its presence in India,” one source said, noting that the Danish major is likely to partner with a regional feeder operator and deploy India-flagged vessels to comply with cabotage regulations.
India’s cabotage laws restrict domestic cargo transport to Indian-registered vessels, although reforms introduced in 2018 have liberalised the movement of export-import (EXIM) containers within the country’s borders.
French carrier CMA CGM has already made strides toward coastal integration, having reflagged the 2,592 TEU CMA CGM Victoria under the Indian registry in April—marking the first such move by a foreign container line. The group has announced plans to register three additional vessels in the coming months, underlining its long-term commitment to the Indian market.
Maersk, meanwhile, has previously experimented with barge operations on India’s upgraded inland waterways for distributing import cargo to hinterland locations and even for cross-border movements to Bangladesh, highlighting its focus on sustainable and cost-efficient logistics solutions.
In addition to domestic feeder operators, international players such as DP World’s Unifeeder and Global Feeder Shipping (GFS), based in the Middle East, are already active in the Indian coastal segment.
Analysis : India’s Coastal Trade Emerging as a Strategic Focus for Global Carriers
India’s coastal shipping sector is rapidly transforming from a niche segment to a key strategic focus for global container lines. This interest is driven by a confluence of favorable government policies, rising domestic cargo volumes, and a long-term shift toward more sustainable and cost-efficient transport modes.
Policy-Driven Momentum
Policy incentives have played a critical role in making the Indian coastal market more attractive:
Cabotage Reforms (2018): While cabotage restrictions still apply for domestic cargo, the allowance for foreign-flagged vessels to move EXIM containers between Indian ports has opened partial entry points.
Tariff Discounts: Coastal shipping is incentivized through lower port tariffs—capped at 60% of regular foreign-going vessel charges—reducing operational costs for interested carriers.
Dedicated Infrastructure: Several Indian ports have invested in dedicated coastal cargo berths, reducing turnaround time and improving operational efficiency.
These policy levers aim to achieve a modal shift from road to sea transport, which is not only environmentally sustainable but also more economical over long distances.
Market Potential and Structural Drivers
India’s growing industrial base, urbanisation, and regional trade integration (such as with Bangladesh and Southeast Asia) are fueling demand for efficient domestic cargo movement. The expected growth of sectors like steel, cement, FMCG, and automotive will add further weight to coastal shipping.
Additionally, projects like GIFT City and dedicated freight corridors are expected to generate predictable, large-volume cargo flows—perfect for liner services.
Global Carrier Interest: Maersk and CMA CGM Lead the Way
Maersk is reportedly working on a partnership-based model using Indian-flagged tonnage, circumventing cabotage constraints.
CMA CGM has already reflagged a vessel under the Indian registry and plans to add more—signaling a serious long-term play in India’s domestic trade.
These moves reflect not only market confidence but also strategic realignment by global carriers who are seeking to entrench themselves deeper in growth markets through vertical integration and inland penetration.
Challenges and Considerations
Despite its promise, India’s coastal trade still faces:
Operational bottlenecks at smaller or non-major ports.
Fragmented regulatory frameworks between central and state-level authorities.
Lower frequency of sailings, which impacts reliability and schedule-based logistics planning.
First-mile/last-mile connectivity issues, which can limit end-to-end service offerings.
Conclusion
India’s coastal shipping market stands at the cusp of transformation. With clear policy direction, rising cargo demand, and increasing interest from international majors, the sector could evolve into a vibrant, multimodal backbone for domestic trade. However, sustained growth will depend on continued infrastructure development, streamlined regulatory frameworks, and close collaboration between global carriers and local operators.