The minister handed over a cheque for Rs five lakh to the father of the drowned fisherman Calvin (19).
"Severe action will be taken as per law against the crew of the ICG ship", he told reporters after vising Calvin's house.
Sunderraj said he would recommend to the Chief Minister to provide government job for one member of the family of Calvin.
Police had yesterday registered a case under section 337 of the IPC (causing hurt by act endangering life or personal safety of others) against the crew of the ship on a complaint from fishermen.
The country boat was carrying five fishermen from Pamban when the ship allegedly collided with it, resulting in the vessel breaking into two pieces. Four of them were rescued by fishermen of another boat while Calvin drowned.
The rescued fishermen alleged their boat was hit by an Indian Coast Guard ship, which was patrolling in the area. They claimed the ship did not stop after the incident.
However, a senior Coast Guard official denied involvement of their ship in the mishap.