DG Shipping notifies a new order for grant of RoFR priority to IFSCA-owned ships

  • October 10, 2023
  • Posted by: OptimizeIAS Team
  • Category: DPN Topics
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DG Shipping notifies a new order for grant of RoFR priority to IFSCA-owned ships

Subject : Economy

Section: Infrastructure

Context:

  • Directorate General of Shipping, which deals with implementation of shipping policy and legislation, has amended its own order on guidelines for exercise of Right of First Refusal (RoFR) – Grant of Licence to foreign flag vessels dated January 14, 2021.
  • The amendment is being done to include priority to International Financial Services Centres Authority (IFSCA) owned ships also for chartering of ships through tender.

Right of First Refusal (RoFR):

  • The RoFR is a contractual right giving its holder the option to transact with the other contracting party before others can. The ROFR assures the holder that they will not lose their rights to an asset if others express interest.

Reducing supply chain disruptions:

  • The early order had only three priorities – 
  1. Indian built,
  2. Indian flagged and Indian owned; foreign built, Indian flagged and
  3. Indian owned; Indian built, foreign flagged and foreign owned.
  • The amended order dated October 5 has these priorities-
  1. Indian built, Indian flagged and Indian owned;
  2. Indian built, Indian flagged and India IFSCA owned;
  3. foreign built, Indian flagged and Indian owned;
  4. Indian build, Indian flagged and Indian IFSCA owned and
  5. Indian built, foreign flagged and foreign owned.

Significance of the amendment:

  • It will provide priority access to vessels and mitigate supply chain disruptions by bringing certainty and consistency.
  • Help in reduction of vessel turnaround time, and berthing and occupancy of the ships will be faster.
  • Compliance will make the system efficient.

Directorate General of Shipping (DG-Shipping):

  • The Directorate General of Shipping, India is an attached office under the Ministry of Shipping, Government of India, responsible for life, health, vessel and the environment for Indian registered ships and ships at Indian ports.
  • The Directorate, is located in Mumbai and led by Director General of Shipping Dr Amitabh Kumar IRS and Additional Secretary to the Government of India.
  • This Directorate deals with all matters concerning the Maritime Administration, Maritime Education and Training, development of Shipping Industry and other related subjects.
  • The Director General of Shipping is vested with statutory powers under Section 7 of the Merchant Shipping Act, 1958.
  • The Directorate deals with implementation of shipping policy and legislation so as to ensure the safety of life and ships at sea, prevention of marine pollution, promotion of maritime education and training in coordination with the International Maritime Organisation, regulation of employment and welfare of seamen, development of coastal shipping, augmentation of shipping tonnage, examination and certification of Merchant Navy Officers, Supervision and Control of the allied departments and officer under its administrative jurisdiction.

IFSCA:

  • The International Financial Services Centres Authority (IFSCA) was established on April 27, 2020 under the International Financial Services Centres Authority Act, 2019.
  • It is headquartered at GIFT City, Gandhinagar in Gujarat.
  • The IFSCA is a unified authority for the development and regulation of financial products, financial services and financial institutions in the International Financial Services Centre (IFSC) in India.
  • At present, the GIFT IFSC is the maiden international financial services centre in India. Prior to the establishment of IFSCA, the domestic financial regulators, namely, RBI, SEBI, PFRDA and IRDAI regulated the business in IFSC.

Source: Business Line

DG Shipping notifies a new order for grant of RoFR priority to IFSCA-owned ships economy