India Rolls Out Subsidies and Preferential Financing for its Shipyards
18.11.2024
India is set to unveil a new policy aimed at incentivizing domestic shipbuilding. The ports, shipping and waterways ministry (MoPSW) is finalizing a cabinet note on incentives to promote domestic shipyards, reported the Indian business newspaper Mint. The proposed incentives are primarily focused on encouraging the development of fuel-efficient and technologically advanced vessels.
The new incentive program is the second phase of the existing Shipbuilding Financial Assistance Policy (SBFAP), which was adopted in 2016 and slated to expire in 2026. In the first phase of SBFAP, 313 vessel orders encompassing both domestic and export orders have been procured by 39 shipyards. So far, 135 vessels have been delivered.
During the second phase, the government reportedly wants to allocate $2.1 billion for the program. This will help provide a 25 percent subsidy for specialized vessels, rising to 30 percent for green and highly specialized vessels.
Another significant proposal is issuing credit notes worth 40 percent of a ship’s scrap value. After a demolition sale, the credit note could be reimbursed against the cost of constructing a new vessel at an Indian shipyard. Through this proposal, the government is hoping to encourage fleet renewal of Indian vessels. Around 44 percent of India’s merchant shipping fleet is above 20 years of age, data from MoPSW shows.
In addition, the government is also considering to introduce a purchase preference policy beginning in fiscal year 2031. This means vessels seeking new registration for coastal cargo transport in India would need to be built at a domestic shipyard.
India is targeting the shipbuilding industry as one of the critical pillars in achieving its Atmanirbhar Bharat vision (self-reliant India). The goal is to increase the percentage share of India-built ships in India’s fleet to seven percent by 2030 and 69 percent by 2047. The subsidy programs are key in making Indian yards as competitive as those of China and South Korea.
India is also in the process of giving the shipping industry infrastructure status for the first time. Currently, only shipbuilding and shipyards have infrastructure status, but the broader coverage will help reduce project costs for the shipping sector. Infrastructure status means a company can float infrastructure bonds, hence attracting investments from commercial banks and other kinds of concessions.
China Angered by the Philippines' New Maritime Laws
11.11.2024
On Friday, the Philippine government enacted two long-awaited laws to reinforce its jurisdiction over its western exclusive economic zone, where China has been steadily encroaching for the last 10 years. The new legislation drew immediate pushback from Beijing, and China's foreign ministry summoned the Philippine ambassador to register its objections.
"With these pieces of legislation, we align our domestic laws with international law, specifically the United Nations Convention on the Law of the Sea or UNCLOS, improve our capacity for governance, and reinforce our maritime policies for economic development and for national security," said Philippine President Ferdinand Marcos Jr. "Our people, especially our fisher folk, should be able to pursue their livelihood free from uncertainty and harassment."
The new Maritime Zones Act formally designates the Philippines' economic zone boundaries, and the new Archipelagic Sea Lanes Act describes a set of designated sea lanes for merchant shipping.
While the Philippines' EEZ is well-defined under UNCLOS, the new Maritime Zones Act reinforces the country's sovereign claim by enshrining it in national law. It also formalizes the government's preferred term for the contested area: for the purposes of Philippine law, the portion of the South China Sea that falls within the Philippine EEZ is now the "West Philippine Sea," removing the word "China" from the area.
"There’s no space for doubt because it’s clear under international law and our domestic laws where our limits are," maritime law expert Jay Batongbacal explained to Rappler. "That’s the final step to make clear what is ours."
In addition, the new Archipelagic Sea Lanes Act will set out three new standard routes for navigation through Philippine waters, and Manila will submit these to the IMO for debate and approval. Indonesia is the only other nation to have gone through this consultative process.
China's government summoned the Philippine ambassador immediately after the laws were signed, and Chinese officials delivered a vigorous and public protest.
China claims sovereignty over almost all of the South China Sea, citing a history of Chinese navigation and activity in the region. Its claim area encompasses international waters and the EEZs of its neighbors, up to a thousand nautical miles away from the Chinese mainland. Beijing asserts that the UN Convention on the Law of the Sea validates its historically-based claim, but the treaty is based on physical distances, and lacks text regarding historical events. The Permanent Court of Arbitration in the Hague ruled against China's sweeping claims in 2016; however, the China Coast Guard continues to attempt to implement Chinese control over the Philippine EEZ using water-cannoning, ramming, boarding and vessel confiscation.
"The so-called arbitral award on the South China Sea is illegal, null and void. China does not accept or recognize it. We oppose and do not accept any claim or action based on the award," explained Chinese foreign ministry spokeswoman Mao Ning on Friday. "The Philippines seeks to justify its illegal claims and actions in the South China Sea by approving the so-called “Maritime Zones Act” in the name of implementing UNCLOS. This is illegal, null and void. . . . China will firmly oppose any infringement activities and provocations by the Philippines in the South China Sea based on the act."
Maersk and Danone team up to cut logistics emissions
29.10.2024
Danone, a global food and beverage company, is joining forces with Maersk to minimize its logistics greenhouse gas (GHG) emissions through Maersk’s ECO Delivery Ocean product.
Maersk’s product is based on reduced GHG emission fuels like bio-diesel or bio-methanol which are produced solely from waste feedstocks. These fuels are then used on vessels across the Maersk fleet.
With the applied version of ECO Delivery Ocean by Danone, the GHG emissions are reduced by more than 40% compared to conventional fossil fuels.
“We are happy to partner with Maersk through Danone’s Partner for Growth program. The ECO Delivery Ocean product and its reduced greenhouse gas emissions align well with our decarbonization strategy to focus primarily on alternative fuels and multimodal transportation. Maersk is an important partner and using their product to reduce CO2 emissions on sea freight marks yet another step in our decarbonization journey,” stated Jean-Yves Krummenacher, Global Chief Procurement Officer at Danone.
Danone aims for net zero emissions by 2050 and has aligned its goals with the Science-Based Targets initiative (SBTi) since 2017.
“The swift reduction of greenhouse gas emissions is at the core of both our companies. Well-known companies like Danone can act as a beacon in their industries by using effective levers to decarbonize their supply chains. We are proud to be Danone’s trusted partner in this important task,” commented Emilio de la Cruz, Maersk’s Managing Director for South West Europe.
Similarly, Maersk targets net zero by 2040 and is the first shipping and logistics company with an SBTi-approved net zero pathway.
The collaboration between Danone and Maersk extends beyond ocean transport to include comprehensive inland transport solutions and dedicated control towers to ensure smooth logistics operations.
Engine Fire Aboard Product Tanker in Singapore Anchorage
21.10.2024
The Maritime and Port Authority of Singapore and the Civil Defense Force responded to a fire aboard a tanker shortly after it arrived in the Singapore anchorage this morning local time. According to the authorities, the 22 crewmembers of the Med Atlantic (26,234 dwt) were successfully evacuated from the product tanker, and the fire was quickly brought under control.
The product tanker registered in Malta for Sea Tankers 4 and managed from Istanbul shows on its AIS signal that it had shifted over from neighboring Malaysia into the Singapore anchorage this morning. The authorities in Singapore received reports of a fire that was said to have started in the engine room and moved into the funnel around 10:30 a.m. local time.