India mulls protection & indemnity club for shipping lines amid war uncertainty

New Delhi: Amid the ongoing war in West Asia and ships stranded in the Strait of Hormuz, India may consider setting up a protection and indemnity (P&I) club for shipping lines and vessels.

Addressing the media on the developments, Rajesh Kumar Sinha, special secretary, ministry of ports, shipping and waterways, said his ministry is in talks with the finance ministry on the subject, and a study is also being conducted on the same.

P&I clubs are independent, non-profit making mutual insurance associations, providing cover for its shipowners and charterer members against third-party liabilities relating to the use and operation of commercial vessels.

The development comes amid requests by several shipowners in India for a P&I club amid the war between US-Israel and Iran and the blockade of the Strait of Hormuz, through which around 20% of India's energy cargoes pass.

There have been discussions on setting up an Indian P&I club earlier as well. However, the plans did not take a concrete shape. In June 2025, Mint reported that the government has started consultations to set up India’s first P&I entity, to be called India Club, that would provide third-party insurance to Indian ships operating in the country’s coastal region and inland waterways.

There was some discussion on the P&I club earlier too, SInha said. "Two-three days back also, we took up the subject with the department of financial services (in the finance ministry). We have also commissioned a study on this, which is underway. The report based on the study should be with us very soon. We will move on the basis of the report. It will be an important step for us," Sinha said.

The need for an India-focused P&I entity has been felt to reduce the country’s vulnerability to international sanctions and pressures where insurance coverage is denied to shipping lines operating between countries facing sanctions.

At present, third-party risks in shipping are insured with the International Group of P&I Clubs, a 13-member group based in London that provides liability cover to over 90% of shipping lines globally.

Apart from fleet owners, the government may also contribute some seed money into the new P&l entity to help it get the necessary capital to start underwriting insurance, Mint reported earlier.

"At present, 22 Indian-flagged vessels with 611 Indian seafarers remain in the western Persian Gulf region. The Directorate General of Shipping continues to monitor the situation in coordination with ship owners, RPSL agencies and Indian Missions," he said.

On India's fuel stock scenario, Sujata Sharma, joint secretary in the petroleum and natural gas ministry, said India remains self-sufficient in petrol and diesel production and liquefied petroleum gas (LPG) supply continues to be monitored in view of the prevailing geopolitical situation.

She also noted that instances of panic booking of domestic LPG cylinders have somewhat reduced from the peak of over 88 lakh bookings reported on 13 March. On Monday, it was down to about 70 lakh bookings, against the pre-war levels of 50 lakh.

"Domestic LPG production from refineries has been increased by about 38%… while delivery authentication code coverage has expanded from 53% before the crisis to about 76% to prevent diversion," Sharma said.

Several states and Union Territories, including Bihar, Delhi, Gujarat, Haryana, Himachal Pradesh, Karnataka, Manipur, Rajasthan and Uttarakhand, have issued orders for allocation of non-domestic LPG in line with government guidelines. The government had earlier allowed supply of 20% of the average use by commercial consumers over a period of the past six months in a bid to ease the supply crunch after the Centre's prioritization of domestic consumers.