New Delhi [India], April 18 (ANI): In a major policy intervention by the PM Modi-led government, the Union Cabinet has approved the creation of a domestic maritime insurance pool with a sovereign guarantee of Rs 12,980 crore.

This is aimed at insulating India's maritime trade from global volatility. The move is expected to significantly reduce dependence on foreign underwriters and ensure uninterrupted risk coverage for Indian shipping.

The proposed 'Bharat Maritime Insurance Pool' (BMI Pool) will provide comprehensive coverage across key segments, hull and machinery, cargo, protection and indemnity (P&I), and war risk for Indian-flagged and Indian-controlled vessels, including those operating in conflict-prone international waters.

This is an important step towards powering India's shipping industry to become one of the top maritime nations by 2047.

Union Minister of Ports, Shipping and Waterways (MoPSW), Sarbananda Sonowal, described the decision as a 'transformational step' in strengthening India's maritime resilience.

'For decades, Indian shipping has remained exposed to external uncertainties dictated by foreign insurance markets. Now, under the visionary and decisive leadership of Prime Minister Narendra Modi ji, this landmark decision ensures that India now has the sovereign capacity to safeguard its maritime trade, even in the most challenging global scenarios,' he said.

India's maritime sector handles over 70% of the country's trade by volume, and nearly 95% by value, yet insurance coverage for this vast ecosystem has largely remained in foreign hands. This structural vulnerability became evident during recent disruptions in key shipping corridors such as the Red Sea, Strait of Hormuz and the Gulf of Oman, when several global insurers sharply increased premiums or withdrew coverage altogether, exposing Indian exporters and shipping operators to heightened financial risk and operational uncertainty.

The BMI Pool is designed to address this gap by ensuring continuity of coverage regardless of geopolitical developments, thereby stabilising trade flows and reducing cost pressures on exporters and logistics stakeholders.

The pool will extend insurance protection to vessels carrying cargo between international ports and India in both directions. It will cover the physical structure of ships under hull and machinery insurance, protect goods in transit through cargo insurance, and address third-party liabilities such as crew injury and environmental damage under protection and indemnity (P&I) coverage.

In addition, it will provide war risk insurance for vessels operating in conflict zones and high-risk maritime corridors, ensuring Indian shipping remains operational even in volatile regions.

Sarbananda Sonowal said the decision reflects a broader push towards strategic self-reliance in critical sectors.

'This is not just an insurance mechanism, it is a statement of India's growing confidence and capability. With the bold and dynamic leadership of Prime Minister Narendra Modi ji, India is building resilient systems that protect national interests while enabling global trade leadership,' he said.

Officials said the move aligns India with major maritime nations such as the United Kingdom, Japan and South Korea, which have already established state-supported insurance frameworks to safeguard national trade interests. The initiative also fits within the broader Maritime India Vision 2030, which identifies the development of robust insurance infrastructure as a key pillar in positioning India as a leading global maritime power. (ANI)