India, 62 Other Nations Agree to Adopting Global Shipping Tax

The United Nations' International Maritime Organization (IMO) approved the world's first carbon pricing mechanism for global shipping on Friday, with India joining Brazil and China in voting to adopt the framework.

- Jayashree Nandi

NEW DELHI: The "IMO Net-zero by 2050 Framework", approved during the Marine Environment Protection Committee's 83rd session in London, combines mandatory emission limits with greenhouse gas pricing across the entire shipping sector. India was represented at the talks by the ministry of ports, shipping and waterways.

Starting in 2028, vessels burning conventional fossil fuels will face a $380 per tonne fee on the most intensive portion of their emissions, and $100 per tonne on remaining emissions above a certain threshold. Ships will need to either transition to lower-carbon fuel mixes or pay for excess emissions generated.

The measures, which will be formally adopted in October 2025 before taking effect in 2027, will become mandatory for large ocean-going ships over 5,000 gross tonnage — vessels that account for 85% of total CO2 emissions from international shipping, according to the IMO.