Export, import cost may increase from Jan 2027 as global shipping faces costly decarbonisation measu

Decarbonisation initiatives for the global shipping sector to cut carbon emissions in the upcoming years may raise the cost of exports and imports starting in January 2027, according to a paper released on Monday by think tank GTRI.

According to the Global Trade Research Institute (GTRI), the 175-member International Maritime Organisation (IMO) announced its plan on July 7 to decarbonize the shipping industry globally and achieve net-zero emissions by 2050. It was also mentioned that the IMO had established interim goals for cutting emissions by 20-30% by 2030 and 70-80% by 2040 in comparison to 2008.

A minimum of 5% of all fuel consumption must be made up with cleaner fuel by the year 2030. Next year, the IMO will announce specific actions. Although IMO recommendations are not enforceable by law, nations are still required to meet the goals specified.

Ajay Srivastava, co-founder of GTRI, stated that despite objections from China and many developing nations, the IMO ignored the proposal and established broad targets this year. A few countries had advocated for a flat price of $100 per tonne of carbon emissions by ships.

It further stated that 6,400 cargo ships are used to transport more than 80% of the world's commerce trade, valued at more than USD 20 trillion. In order to exist in a low-carbon future, it was estimated that India's shipping industry needs set aside more than USD 100 billion.
 

Source: The Economic Times