FINANCE MINISTRY TO EXTEND NRI BENEFITS FOR FOREIGN GOING SEAFARERS IN INDIAN WATERS ALSO

FSUI Welcomes Move By Ministry; Real Income Of Seamen Could See a Rise Of As Much As 30% 

A long pending demand of seafarers working on Indian flag ships and the merchant navy trade unions are all set to get fulfilled with the finance ministry in-principle agreeing to extend non-resident Indians (NRIs) status and the subsequent income tax benefit to the seafarers while in Indian waters as well. At present over 50,000 seafarers working on Indian flag ships do not enjoy the benefit. It is restricted only to seamen employed in ships with foreign flag.

Currently seamen employed in Indian flag vessels become eligible for NRI benefits in Income Tax only if he spends more than 183 days in foreign water. So, if a seafarer serves for 200 days in a foreign going ship that spent twenty days in the Indian water collecting cargo from, for instance, Mumbai, Mangalore and Kochi ports, the seaman would not become eligible for NRI status. The number of days served by him in Indian water will be deducted from the total number of days served on the ship, and if the tally falls short of 183 days, then he will become liable to pay full taxes.

Once the new guideline comes into effect, even the days spent in domestic water will be taken into consideration along with the days spent in foreign water. “Our former Vice President, the late Dr. M. K. Pandhe had pointed out to Dr. Pranab Mukherji, the then Finance Minister, in the pre-budget meeting of 2009 and through various other letters and petitions, that the Indian officers and seamen who are working onboard the Indian flag ship is subjected to the Income Tax Process, as taxes, whereas the officers and seamen of the Foreign flag vessels are exempted by the Indian Government,” says Mr. Naresh Birwadkar, General Secretary, Forward Seamen’s Union of India (FSUI). “With the correction of disparity, seamen employed by Indian ships could end up saving as much as 30% of the their pay.”

“Once the new directive is issued, Indian officers and seafarers will find it equally attractive to be employed by Indian vessels. Indian officers and seafarers currently prefer to work for foreign flag vessels, making a dent in the Indian Shipping Industry creating shortage of officers. Many Indian flag ships are standing without proper manning and unable to sail out as key officers are not forthcoming. The new structure will hopefully correct the imbalance,” adds Mr. Birwadkar.

Forward Seamens’ Union of India (FSUI), the largest trade union of Indian seafarers has been demanding an NRI status and review on tax structure for them. “We have been advocating with the various central government agencies for the same. Now, the finance ministry has agreed. A formal notification will be issued soon,” said FSUI’s General Secretary Naresh Birwadkar.

The new initiative comes in the wake of the Government lifting restrictions on owning foreign flag ships and enabling Indian companies to register a ship in a foreign jurisdiction, yet operate those from here. 

SEAFARERS SEEK FINAL CLOSURE TO EXPLOITATION

Union Asks Members to be prepared

Mumbai: With over ninety thousand seafarers, India is home to the second largest number of seafarers in the world – a record, according to Forward Seamen’s Union of India (FSUI), maintained by near total exploitation and violation of basic rights of seamen. In a circular issued to its members, FSUI has asked seafarers, belonging to both Indian and foreign flag ships, to be prepared for a long agitation to achieve their basic rights, which, in the recent past had been seeing consistent erosion. The circular has also asked seafarers, in an extreme eventuality, to be prepared for a strike.

“We will not call for a strike, except as the last resort,” clarifies Mr. Naresh Birwadkar, General Secretary, FSUI. “But the ground reality is that the ship owners have started blatantly taking advantage of seafarers. Laws enacted to protect seafarers are being disregarded, circumvented and violated, and benefits that exist in all shore based industries are being denied to sea men.”

The circular further points out that allowances like dearness allowance and house rent allowance, which are paid to even contract workers in shore based jobs are denied to seafarers. The basic wages paid to Seafarers is less than the basic wages paid to class four employees in shore-based industries. In direct violation of the Merchant Shipping Act, ship owners have started employing seafarers only on contract basis through manning agents.

“To provision for the cyclical nature of employment in shipping business, exposure to rough weather and working conditions, impact of sea life on health and other aspects specific to the industry, the Merchant Shipping Act was enacted. Violations of these provisions make the seafarers vulnerable and unprotected, making their service contract equivalent to bonded labour,” adds Mr. Birwadkar.

“The sea farers are fighting for their very survival. The practice of illegal recruitment of seafarers is becoming widespread. Employers take advantage of poverty and desperation of seafarers and recruit them without proper agreement, insurance or paper work. This puts them at the mercy of the employers. It is also being observed that whenever any accident or causality occurs, the family members are not adequately compensated,” says Mr. P. G. A. Joseph, President, FSUI.

The FSUI has further contended that Seafarers Welfare Fund Society – the only welfare body for seafarers, and something that is equivalent to Provident Fund in onshore jobs – covers only foreign going registered seamen. This keeps seafarers working in all other sectors including offshore and home trade outside the ambit of any welfare.

“Ship owners and trade unions entering into agreements that do not protect the interests of the seafarers further compound the problems. The wage agreement that is currently in force and signed by Indian National Shipowners Association (INSA) and National Union of Seafarers Association of India (NUSI) give the seafarers a meager 0% increment in the first year and thereafter another 2%. In this day and age when inflation, dearness allowance, housing costs, travelling costs, cooking fuel, and other basic items grew by ten, twenty and in some cases even hundred percent, this kind of agreement is a joke. The case is now awaiting judgment in Supreme Court and we are sure the judgmentwill be favorable to us. In the meantime, we will continue to explore all avenues to end the exploitation of seafarers. And to achieve this we are willing to adopt any extreme measure so long as they are legal and ethical,” concludes Mr. Birwadkar.

About FSUI: Forward Seaman's Union of India (FSUI), formerly known as Forward Block was founded by Netaji Subhash Chandra Bose and was established on the 30th of May, 1954. In 1970 the constitution was amended and the outfit was then renamed FSUI. With over 32,000 members today, FSUI has been relentlessly working for seamen’s rights and has always been in the forefront to champion their cause since the last 60 years. It has branches in Mumbai, Kochi, Port Blair, and other Ports in India and has strong relationship with a number of fraternal panel trade unions in India and outside. It is an organization dedicated to safeguard and take care of the interests of the seafarers. It has also constituted the Offshore and Home Trade Seamen’s Welfare Trust (OHTSWT) that will offer a bevy of benefits and welfare measures for seamen and their families. The trust runs a hospital that provides free treatment to its members and families and is in the process of constructing an old age home that will accommodate one hundred and fifty inmates.