Indian Shippers Expect Freight, Fuel Prices to Rise

After a major net-zero carbon emissions framework was agreed upon by the International Maritime Organization (IMO), India sees the upcoming carbon levy—the first in global shipping—raising fuel and freight costs for its own fleet.

- DHRUVAKSH SAHA

However, the Directorate General of Shipping (DGS) says there is no cause for concern.

The DGS—the country's shipping regulator—has said that added costs would be well within the industry's comfort zone, adding that the India-Singapore proposal agreed upon by the United Nations' maritime body (IMO) will save the sector over $2 billion till 2030 as compared to the European Union's proposal.

"The total compliance cost is projected at $87-100 million annually by 2030, assuming partial reliance on remedial units. This is equivalent to a 14 per cent increase in fuel cost and 5 per cent rise in freight rates—well within the industry's operating margins," it said in a guidance note to maritime stakeholders.