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As the millennium dawned, the world feared that computers would crash because of the Y2K bug. Twenty years later, as 2020 kicked in, there were fears that merchant ships would sputter to a halt, disrupting world trade.
The reason? The International Maritime Organization (IMO), the United Nations agency tasked with regulating shipping, had mandated that merchant ships should not burn fuel with sulphur content greater than 0.5% beginning January 1.
Before the ban, fuel had a comfortable sulphur content limit of 3.5%, which was applicable to most parts of the world. Despite the industry gradually gearing up to introduce the new fuel, many industry professionals feared that the new very-low-sulphur fuel would be incompatible with the engines and other vessel equipment.
Past mandates on sulphur limits in American waters had led to many technical problems. There have been instances of ships having been stranded after fine particles separated out from the fuel, damaging equipment and clogging up devices.
This has not happened so far. But the global sulphur cap is only one of the many environment-related regulations that have been shaking up the shipping industry; the industry is generally risk-averse and slow to accept changes. For instance, efforts are ongoing to reduce nitrogen oxides (NOx) and ozone-depleting gases. Further, the IMO has announced an ambitious project to decarbonise shipping in order to reduce carbon emissions. These regulations are triggering massive technological, operational and structural changes; they come at a price which will have to be borne to a large extent by developing countries such as India.
The IMO currently lists India as among the 10 states with the “largest interest in international seaborne trade”. But India’s participation in the IMO to advance its national interests has been desultory and woefully inadequate.
Shipping, which accounts for over 90% by volume and about 80% by value of global trade, is a highly regulated industry with a range of legislation promulgated by the IMO.
The IMO currently has 174 member states and three associate members; there are also scores of non-governmental and inter-governmental organisations.
The IMO’s policies or conventions have a serious impact on every aspect of shipping including the cost of maritime trade. The sulphur cap, for instance, will reduce emissions and reduce the health impact on coastal populations but ship operational costs are going up since the new fuel product is more expensive. As refineries including those in India struggle to meet the demand, freight costs have started moving up, with a cascading effect on retail prices.
The IMO, like any other UN agency, is primarily a secretariat, which facilitates decision-making processes on all maritime matters through meetings of member states. The binding instruments are brought in through the conventions — to which member states sign on to for compliance — as well as amendments to the same and related codes.
Structurally, maritime matters are dealt by the committees of the IMO — the Maritime Safety Committee (MSC), Marine Environment Protection Committee (MEPC), Technical Cooperation Committee, Legal Committee and the Facilitation Committee. Each committee is designated a separate aspect of shipping and supported by sub-committees. Working groups and correspondence groups support the subcommittees.
The subcommittees are the main working organs, where the proposals from a member state are parsed before they are forwarded to one of the main committees. The main committees, thereafter, with the nod of the Assembly, put the approved proposal for enactment through the Convention, amendments, and codes or circulars.
Prominent maritime nations have their permanent representatives at London and are supported by a large contingent (of domain experts from their maritime administration, seafarers and industry associations) during the meetings. They ensure that they have representation in every subcommittee, working group and even correspondence groups so that they are clued in. Lobbying is key while event sponsorship generates goodwill and support.
To ensure that their maritime interests are protected, the European countries move their proposals in unison and voting or support are given en bloc. China, Japan, Singapore, Korea and a few others represent their interests through their permanent representative as well as ensuring that a large delegation takes part and intervenes in the meetings.
While these countries have fiercely protected their interests, India has not. For example, its permanent representative post at London has remained vacant for the last 25 years. Representation at meetings is often through a skeletal delegation, approved by the Ministry. Participation in IMO meetings is seen more as a junket. A review of IMO documents shows that the number of submissions made by India in the recent past has been measly and not in proportion to India’s stakes in global shipping.
There have also been obstacles in pushing issues which are of importance to India. A classic case was the promulgation of “High Risk Areas” when piracy was at its peak and dominated media headlines.
The IMO’s demarcation resulted in half the Arabian Sea and virtually the entire south-west coast of India being seen as piracy-infested, despite the presence of the Indian Navy and Coast Guard. The “Enrica Lexie” shooting incident of 2012, off the coast of Kerala was a direct fallout of the demarcation.
The “High Risk Area” formulation led to a ballooning of insurance costs; it affected goods coming into or out of India. It took great efforts to revoke the promulgation and negate the financial burden. The episode highlighted India’s apathy and inadequate representation at the IMO. There was also great difficulty in introducing the indigenously designed NavIC (NAVigation with Indian Constellation) in the worldwide maritime navigation system.
In contrast, the European Union has a documented procedure on how to influence the IMO. New legislative mandates, fitment of new equipment and changes to ship structural designs being brought on have been driven by developed countries. They are not entirely pragmatic from the point of view of India’s interests. Further, it will not be mere speculation to see them as efforts to push products and companies based in the West.
So far, India’s presence and participation in the IMO has been at the individual level. India should now make its presence felt so that its national interests are served. It is time India regained its status as a major maritime power.
Captain L.K. Panda retired as Nautical Adviser to the Government of India and has represented India in the IMO. M. Kalyanaraman is a marine engineer-turned journalist
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