India and 62 other countries have voted in favor of the world’s first global carbon tax on the shipping industry, as decided by the United Nations’ shipping agency. The decision, made at the International Maritime Organisation (IMO) headquarters in London after a week of negotiations, aims to decrease greenhouse gas emissions from ships and encourage the development of cleaner technologies. The tax has the potential to generate up to $40 billion by 2030.
Despite being considered a breakthrough in international climate policy, the agreement has been criticized for not adequately addressing the climate finance needs of developing countries. The revenues collected from the carbon tax will be specifically used for decarbonizing the maritime sector and will not be allocated to broader climate finance efforts. Additionally, carbon pricing is projected to achieve only a 10% reduction in shipping emissions by 2030, falling short of the IMO’s 20% reduction target.
The agreement was supported by 63 countries, including India, China, and Brazil, but faced opposition from oil-rich nations such as Saudi Arabia, the UAE, Russia, and Venezuela. The US delegation did not participate in the negotiations or the voting. Environmental groups and negotiators from smaller countries have expressed their intent to continue advocating for a more ambitious and equitable outcome.