Finance minister Nirmala Sitharaman on Thursday made a case for a full-fledged locally owned and based Protection and Indemnity Insurance, or P&I, entity and called for developing capabilities and legal systems so that the country can have an international arbitration centre for the maritime sector.
She also said that such P&I entities would reduce the country’s vulnerability to international sanctions and pressures and provide greater strategic flexibility in shipping operations.
According to the latest report of the Insurance Information Bureau of India (IIB), the gross direct premium of the cargo and hull marine segments for FY20 was ₹3,400 crore, which recorded a positive growth rate of nearly 12% over the previous year.
The Insurance Regulatory and Development Authority of India (IRDAI) is keen to develop more indigenous capacity for maritime insurance risk.
The minister stressed on the need to improve and strengthen arbitration processes and laws so that they meet global standards.
The finance minister said that she is in talks with public sector banks to have a more positive approach towards financing the maritime sector.
“I also want private sector lenders to look at the shipping and maritime sectors more proactively,” she said, adding that the operators should also look at fundraising on their own through asset monetisation.
The minister also asked the ministry of ports, shipping and waterways to fast-track monetisation of projects identified at 12 ports.