Under the new rules formulated by India’s Directorate General of Shipping (DGS), LNG projects should only import cargo on Indian-flagged carriers. Furthermore, these India-flagged tankers must either be entirely owned by an Indian “entity” or have an Indian partner(s) with a minimum of 26% of the company share.

According to Projects Monitor, “The guidelines further state that existing owners of foreign-flagged LNG carriers must give an unconditional and irrevocable undertaking to the DGS to convert them to the local flag within one year of introduction of tonnage tax.”

“For spot trade, cargoes carried on foreign-flagged vessels must not exceed 10 per cent of total annual imports during a financial year and in such cases, the 10 per cent limit will be calculated separately for each project/ regasification terminal,” it added.

The Indian government, nor the DGS, were available for comment.