India and 62 other nations have supported the imposition of the world’s first global carbon tax on the shipping industry by the United Nations’ shipping agency. The decision, made at the International Maritime Organisation (IMO) headquarters in London, aims to decrease greenhouse gas emissions from ships and promote the adoption of cleaner technologies. This measure is expected to generate up to $40 billion by 2030.
While seen as a breakthrough in international climate policy, the agreement has faced criticism for not addressing the climate finance needs of developing countries. Revenues from the carbon tax will be exclusively allocated to decarbonizing the maritime sector, excluding broader climate finance efforts. Furthermore, carbon pricing is projected to reduce shipping emissions by only 10% by 2030, which is below the IMO’s target of at least 20%.
The deal was backed by countries like India, China, and Brazil, but opposed by oil-rich nations including Saudi Arabia, the UAE, Russia, and Venezuela. A group of over 60 countries, primarily from the Pacific, Caribbean, Africa, and Central America, had advocated for directing some of the revenues towards broader climate finance needs, expressing disappointment with the final outcome.