The Centre has relaxed vessel ownership requirements under the Merchant Shipping Act, 2025, allowing ships majority-owned by Indian citizens and other eligible Indian entities to qualify for registration as Indian vessels.
A Gazette notification issued by the government defines majority interest as legal ownership of more than 50% of the shares into which a vessel’s property is divided. The move marks a shift from the earlier requirement under the Merchant Shipping Act, 1958, which mandated 100% ownership by qualifying Indian citizens, companies or co-operative societies.
However, officials have clarified that meeting the majority ownership threshold does not automatically grant a vessel Indian registration or the right to fly the Indian flag. Eligible owners must submit the necessary applications and complete the prescribed registration process.
The new framework recognises a wider range of eligible owners, including Indian citizens, Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs), companies and statutory bodies established under Central or State legislation. Co-operative societies, multi-State co-operative societies and limited liability partnerships (LLPs) are also eligible.
Companies and other qualifying entities must have their registered office or principal place of business in India. Co-operative societies and LLPs must also be registered under the applicable Indian laws.
The notification further specifies additional conditions where an NRI or OCI holds the majority interest in a vessel. In such cases, the registration must be supported by an authorised representative, who must either be an Indian citizen residing in India or a body corporate incorporated in India with its registered office or principal place of business in the country.
The Merchant Shipping Act, 2025, had left the specific ownership threshold for vessel registration to be prescribed through a government notification. The latest notification provides clarity on the requirement and broadens the ownership structure permitted for Indian vessel registration.
The revised provisions are expected to provide greater flexibility for Indian-linked ship ownership and potentially encourage wider participation in the country’s shipping sector.