Indian shipping companies feel the heat as more and more Indian marine officer, who are in short supply continue to migrate to foreign ships where they are not burdened with taxes.
The flight of Indian marine officers to foreign shipping companies has become a cause of worry for Indian shipping companies who are already plagued by shortage of officers. Recently, the Indian National Shipowners Association (INSA) requested the Ministry of Shipping, Government of India to exempt Indian ship staff from seafarer’s tax being the crux of this problem and Indian officers who serve on foreign ships are exempt from paying taxes.
“Seafarers working on Indian ships who do not complete 183 days at sea are being subjected to income tax,” explained S. S. Rangnekar, CEO of INSA. “This places them at a great disadvantage with other Indians serving on foreign ships who are not so taxed. Even if foreign vessels were to continue trading on the Indian coast, Indian seafarers on these vessels still get exempted from income tax. This has resulted in seafarers on Indian vessels preferring to sail with foreign shipping companies.”
“We are compelled to compromise on the quality of seafarers since trained and experienced seafarers have been moving to foreign shipping companies,” said Yudhisthir Khatau, Managing Director of Varun Shipping. “The quality of marine officers being employed on Indian vessels is falling, but the situation is not grave at the moment.”
“Because of the shortage we have to request our colleagues who are serving on our ships to stay a little longer,” informed S Hajara, CMD of SCI and President of INSA. “Besides, those on leave are being asked to resume earlier. Now with more ships joining the fleet we are being forced to take senior marine officers on ‘contract’ basis. We do take older retired staff as the Director General of Shipping has made a concession for engaging such officers of up to 65 years of age and even older on a case to case basis provided the person is medically fit.”
Marine officer shortage is a worldwide phenomenon there does not appear to be any quick solution. Companies who are going in for acquisitions are faced with manning problem. Training more officers seems to be the only long time solution but it will take some to fill in the shortage gap according to Capt SC Sood, Managing Director of IMS Ship Management (P) Ltd. He explained that most companies are trying to make at least two training slots available on board their ship. But there is no way for companies which train the officer cadets to compel them to continue serving with their company after finishing their training.