'Refrain from predatory pricing': India's shipping body to carriers amid Hormuz disruption

Amid tensions in West Asia and the effective closure of the Strait of Hormuz, which has disrupted the energy flow, India's Directorate General of Shipping (DGS) has issued a crucial advisory, urging carriers and their agents to promote transparency in transaction costs and avoid predatory pricing in the export-import (EXIM) trade.

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The advisory, released on March 9, emphasises the importance of fair practices in the maritime industry, especially as the shipping sector navigates the complexities of the current global climate.

The DGS, which is part of the Ministry of Ports, Shipping, and Waterways, pointed out that the Merchant Shipping Act of 1958 was put in place to foster a strong and effective Indian maritime industry that can serve national interests.

The Multimodal Transportation of Goods Act, 1993 governs the registration of Multimodal Transport Operators (MTOs). However, the DGS has received complaints from stakeholders in the EXIM trade about rising charges that lack transparency and seem opportunistic in nature.

"These charges are perceived to be non-transparent and opportunistic in nature, resulting in an escalation of transaction costs within the logistics chain," the DGS explained, acknowledging the concerns that have been raised.

The advisory also refers to a previous circular (DGS Circular No. 1 of 2016), which had called for clearer communication of extra charges by shipping companies.

Now, with the latest advisory, the DGS is taking the message further by urging all stakeholders in the industry to adopt fair pricing practices to avoid disputes and unnecessary confusion in the trade process.

To strengthen these calls, the Merchant Shipping Act of 2025 includes provisions that require shipping companies to communicate their charges upfront. The advisory ensures that exporters, importers, and all stakeholders are aware of any costs involved from the very beginning.

The DGS expressed hope that the maritime industry would work together to maintain transparency, reduce logistics costs, and make India a more competitive player in global trade. By sticking to fair practices and clear communication, the aim is to make the entire shipping process smoother and more predictable for everyone involved.