India has taken another step toward potentially establishing its own Protection and Indemnity (P&I) Club, with the Directorate General of Shipping issuing a tender for consultants to assess the feasibility of the project.
According to India Shipping News, the tender process began on 12 November and is set to conclude on 16 December. Captain Manish Kumar, a senior official at the Directorate General of Shipping in Mumbai, is overseeing the process.
The initiative, tentatively named the “India Club,” is intended to provide third-party maritime insurance for Indian vessels operating in coastal waters and inland waterways. It also aims to reduce India’s reliance on foreign insurers, often subject to international sanctions.
According to Finance Minister Nirmala Sitharaman, establishing a domestic P&I club would “reduce India’s vulnerability to international sanctions and pressures to provide strategic flexibility in shipping operations.”
This development follows India’s decision in December 2022 to abstain from joining the G7-led sanctions regime targeting Russian oil exports, TradeWinds News noted. Instead, the country has capitalised on discounted Russian oil, becoming one of its largest importers alongside China. However, India has faced limitations due to the restrictions on sanctioned vessels and operators, underscoring the need for greater self-reliance in the maritime insurance sector.
Currently, Indian-flagged vessels rely heavily on the international fixed premium market for P&I coverage. The proposed India Club would initially cater to these vessels, with plans to expand into global shipping markets. Public sector insurers such as New India Assurance and GIC Re are reportedly being considered as potential partners for the initiative.
India’s move aligns with broader global trends, as countries like China and Russia have also developed their own non-International Group P&I entities. Notably, the China P&I Club has experienced significant growth, with its mutual tonnage now surpassing that of several International Group members.
In October, the Indian government said it is exploring options for funding the domestic P&I Club. According to a senior official from the Ministry of Ports, Shipping, and Waterways, they have had plenty of discussions and have considered “the possibility of an initial ‘seed’ fund once legislative provisions are in place.”
