News / Indian shipowners move to modernise fleets as new vessel-age rules loom

Credit Shreyas Shipping and Logistics

In an early sign of supply chain transformation in India, niche feeder lines operating on coastal or regional short-haul routes have begun to modernise their tonnage, as government revises its ship-age policy.

Mumbai-based operator Shreyas has just acquired two mid-size second-hand containerships, of 2,872 teu and 2,553 teu, to upgrade its fleet after disposing of two aging 1998-built vessels, the SSL Chennai and SSL Kochi.

The move comes as, amid growing marine environmental concerns, the Directorate General of Shipping (DG Shipping), India’s maritime administrator, is close to releasing the final shape of legislation to restrict ships of 25 years old or more from calling at Indian ports.

“Quality tonnage is paramount for safe and secure expansion of the maritime sector and to achieve sustainability in ocean government,” said DG Shipping in its provisional document.

And a source at the Indian National Shipowners Association (INSA) told The Loadstar: “The recent new acquisitions are a sign that owners have begun to mull over the age of vessels in the trade. This realisation has prompted operators to upgrade.”

Another Mumbai-based liner industry representative noted that, besides intra-country or coastal trade tonnage, vessels deployed on Africa routings out of India were mostly older and “we will see them getting axed gradually”.

Demand for shortsea shipping connections in India has seen some traction after the government liberalised cabotage rules in 2018 to encourage foreign-flag participation. But smaller operators, usually thriving on inducement calls, could now face competitive challenges in the charter market.

Several global liner leaders, like Maersk and ONE, have recently launched short-haul connections out of India to serve transhipment/regional trade, and vessel redeployments have also become an industry strategy to minimise the impact of slowing demand.