Editorial: India’s maritime potential waiting to be tapped
Outdated laws, high logistics costs, and dependence on foreign vessels continue to limit the country’s global competitiveness
India’s maritime sector presents a story of unrealised potential. It’s a rather familiar experience with many other industries in the country. Despite a coastline stretching over 11,000 km and about 14,000 km of navigable waterways, India continues to underuse its maritime potential compared to road and rail. Currently, only 7 per cent of freight moves by sea or inland waterways, while about 65 per cent goes by road and 22 per cent by rail. Against this backdrop, the Centre’s recent investment push in the sector is a welcome development. While addressing the Maritime Leaders Conclave, as part of India Maritime Week 2025, Prime Minister Narendra Modi spoke about how India has now emerged as a global maritime power, backed by major reforms, record investments, and growing international confidence. With participation by over 85 countries and the signing of Memoranda of Understanding (MoUs) worth several lakh crore of rupees, the IMW-2025 served as a platform for new port, shipbuilding, and inland waterway partnerships. The event, hosted by India, showcased efforts to modernise maritime infrastructure, attract global investment, and integrate sustainability and technology into its long-term ocean economy strategy. However, several challenges remain. They include regulatory fragmentation, infrastructural and logistic bottlenecks, ageing domestic vessels, a shortage of skilled workforce, and growing competition from established transhipment hubs like Singapore and the United Arab Emirates (UAE). The increasing geopolitical tensions in the Indian Ocean Region also add to the list of challenges. Historically, the maritime sector has been governed by multiple outdated laws, some of which date back to the 19th century.
Though the new Indian Ports Bill, 2025, aims to modernise the industry, critics have flagged concerns about potential centralisation of power and reduced autonomy for States. While the objective of the new Act is to improve legal clarity, enhance transparency, and streamline port and shipping operations, the proposed dispute resolution mechanisms may not be enough to attract investors. Many non-major ports lack adequate infrastructure and connectivity, and the overall logistics costs — around 13 per cent — are still higher than the global average of 8-9 per cent. Overdependence on foreign vessels is another problem area. Nearly 90-95 per cent of India’s cargo is transported by foreign shipping lines, and most containers are imported, an area dominated by China. Experts have warned that as long as foreign carriers dominate India’s trade, the country will have limited influence over key issues such as freight rates. A NITI Aayog study has pointed out that non-major ports lack adequate infrastructure, skilled manpower, and connectivity, limiting their contribution to national trade. Many of these ports operate below capacity and struggle with regulatory bottlenecks. Moreover, several port projects face inordinate delays in land acquisition, environmental clearances, and inter-agency coordination. Inland waterway development, on the other hand, is progressing slowly, affecting multimodal logistics efficiency. By comparison, China’s maritime network is very robust and modernised. Nearly 34 per cent of China’s freight moves by water, 43 per cent by road, and 17 per cent by rail.
