Page 4 - Annual Review 2021 full

Indian National Shipowners’ Association
CEO Speak
By Mr. Anil Devli, CEO, INSA
What is going to be the future of Indian Shipping:
Decarbonisation or obsolescence
Till about yesterday, what was thought of as just
a new word added to the shipping parlance that
is “decarbonisation,” today has become the new
and complex language in shipping which the
entire shipping world is struggling like wannabes
to understand, master and live up to as the
decarbonisation targets loom.
So what is the genesis of this new language of
shipping?
In 2018 International Maritime Organization (IMO)
had adopted its Initial Strategy on Reduction of
GHG Emissions from Ships. Two key ambitions of
the strategy were as follows:
i. carbon intensity of international shipping to
decline so as to reduce CO2 emissions per
transport network, as an average across
international shipping, by at least 40% by
2030, pursuing efforts towards 70% by 2050 as
compared to 2008; and
ii. to peak GHG emissions from international
shipping as soon as possible and to reduce the
total annual GHG emissions by at least 50% by
2050 compared to 2008.
While the end game is to phase emissions out
completely consistent with the Paris Agreement
temperature goals, there are two short term
measures viz. Energy Efficiency Existing Ship
Index (EEXI) and Carbon Intensity Indicator (CII)
which are applicable to existing ships that have
been developed and incorporated in MARPOL
Convention and would be applicable from 1st
January 2023. Also, a system for collection of data
related to fuel oil consumption and transport work
done by each ship above GT 5000 each calendar
year (known as IMO DCS) has started since 2019.
This data will be used to decide on policy measures
for further reduction of GHG emissions from
international shipping.
The International Convention for the Prevention
of Pollution from Ships (MARPOL) is the main
international convention covering prevention of
pollution of the marine environment by ships from
operational or accidental causes.
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In a related development, the first instalment of the
6th Assessment Report of Intergovernmental Panel
on Climate Change (IPCC) published on 6th August
2021 stated that the earth could exceed 1.5°c of
global warming – the “safe” limit for temperature
rise outlined in the Paris Agreement – as soon
as the early 2030 and that staying below 2°c this
century will only happen if emissions reach net zero
by 2050 with the addendum that the Global GHG
emissions must peak sometime in the middle of this
decade - in other words within next few years.
While the purpose of these regulations is to ensure
that international shipping is put in a GHG emission
intensity reduction trajectory to achieve at least
40% reduction by 2030 compared to 2008 baseline,
what it is doing in reality is that it has given a rude
wake up call to world shipping including the Indian
flag shipping industry.
An important and related event was the 26th
Conference of Parties of the UN Framework
Convention on Climate Change (UNFCCC), or
CoP 26 as it is popularly called which was held
on 12th November in Glasgow, Scotland. At the
summit, Prime Minister Narendra Modi announced
that India will aim to attain net zero emissions by
2070. He also announced that India will draw 50%
of its consumed energy from renewable sources
by 2030, and cut its carbon emissions by a billion
tonnes by the same year.
Therefore, a transition to low and zero-carbon fuels
is essential for shipping industry to meet these
goals of Paris Agreement and the Zero-Emission
Shipping Mission of which India is a core mission
member.
Central to this merry mix of various deadlines and
commitments for green shipping is one sobering
fact that India needs to replace its entire shipping
fleet in the next 2-3 years. The choices that will be
available then and the ones finally made, in the
wake of these green deadlines has the potential to
make or mar the fortunes of the Indian flag shipping
industry that is invested to the tune of Rs. 90,000
crore in the Indian economy.
Today, in the immediate term, the shipping
industry and the charterers do have the option of
making what seem to be relatively easier choices
liking running ships at lower speed though the