India bears Sri Lanka ferry costs for one year

The Government of India has decided to bear the cost towards relevant charges and operating cost at Nagapattinam port to the tune of over LKR 25 million per month for a period of one year for the passenger ferry service between Nagapattinam in India and Kankesanthurai (KKS).

The passenger ferry service, which was launched in October 2023 by the Shipping Corporation of India (SCI), will tentatively resume on May 13, 2024. It will be operated by a private operator, IndSri Ferry Services, selected by SCI in consultation with the Government of Sri Lanka (GOSL).

In order to make the service affordable and attractive for passengers, the Government of India has decided to bear the cost towards applicable taxes and other charges to the tune of over LKR 25 million per month for a period of one year. 

Similarly, the GOSL has reduced the deviation tax currently charged from passengers leaving Sri Lanka by passenger vessels and ships.

It should be recalled that the Government of India has also extended a grant assistance of USD 63.65 million to the GOSL for the rehabilitation of the KKS Harbour, which was earlier envisaged to be undertaken under a Line of Credit.