Advance Cargo Info System in works by Customs

NEW DELHI: India is working on anadvancecargoinformationsystem on the lines of the advance passenger informationsystemputinplacebythe US after 9/11 that will allow immediate customs clearance of importswithscrutinylimitedtoariskbasedassessmentofshipments.

Such a system would allow customs authorities to know beforehand the contents and arrival time of cargo. The information can then be used to pre-clear the consignments or keep them for further checks based on the contents and the information thrown up by the risk-assessmentsystem.

Variousagenciesthatareinvolved in vetting import cargo such as plant quarantine can also carry out their checksonthebasisofdata.

A pilot to test pre-arrival cargo data exchange is already on with the Maldives and discussions are now on with countries including South Korea to expand this system. New Delhi has already inked an agreement for the pre-arrival exchange of country-oforigincertificateswithSouthKorea.

'Pre-arrival data exchange is being examined,' a Senior Governmentofficialsaidrecently.

Such an exchange could become partoffuturetradeagreementtalks.

The Central Board of Indirect Taxes and Customs is working on the initiative as part of customs facilitation to further improve the ease of doing business in the country. Pre-arrival data exchange could form part of a future revamp of the country's customs framework to boost trade facilitation.

Such a system is expected to not just aid expeditious identification and tracking of suspicious goods but also come in handy in verification of country-of-origin certificates with countrieswithwhomIndiahasatrade agreement.

Export, import cost may rise from Jan 2027 as Global Shipping faces costly decarbonisation measures : GTRI

NEW DELHI: Decarbonisation measures for the global shipping industry to reduce carbon emissions in the coming years may increase the cost of doing exports and imports from January 2027, a report by think tank GTRIsaid.

The 175-member International Maritime Organization (IMO) notified its strategy on July 7 to decarbonise the global shipping sector and achieve netzeroemissionsby2050,theGlobalTrade ResearchInstitute(GTRI)said.

ItaddedthatIMOhasalsosetinterim targets for reducing emissions by 20-30 per cent by 2030 and 70-80 per cent by 2040, compared to 2008. It added that IMO has also suggested the shipping industryshouldswitchtocleanerfuel.

"By 2030 cleaner fuel must account for a minimum 5 per cent of total fuel use. IMO will notify detailed measures next year. While IMO recommendations are not legally binding, countries are expectedtoachievethetargetsset.This year, few countries pushed for a flat tax ofUSD100pertonneofcarbonemission by ships, yet IMO ignored the recommendation and set broad targets due to opposition from China and many developing countries," GTRI cofounder Ajay Srivastava said. India should watch out against the IMO recommendingpunitivelevies,hesaid.

"Compliance with the two directives will result in about 3-4 per cent increase in the price of export and import products, amounting to $ 600-800 billion annuallyatgloballevel,"thereportsaid.

It added that over 80 per cent of the world's merchandise trade valued at more than USD 20 trillion takes place through6,400cargoships.

The shipping industry contributes about 3 per cent of greenhouse gas emissions annually using fossil fuels likebunkeroil.

Further, it said that the EU parliament has included shipping in the EU's Emissions Trading System (ETS) on April 18. As a result, it will start charging tax from EUs outbound and inbound shipping companies from Jan1,2027.

TheEUETSwillinitiallycoverlarge ships of 5,000 gross tonnes and above but will be expanded after 2026 to cover smaller ships. On the emission side, initially, only carbon emissions will be tracked, but from 2026, all greenhouse emissions, including methane and nitrousoxidegases,willbecovered.

"The EU is working out the implementing regulations. The measures are expected to be broadly similar to the Carbon Border tax notified for steel, aluminium and other products,"itsaid.

It also said that the share of Indian ships carrying India's merchandise trade has declined from 40 per cent in the late 1980s to less than 8 per cent at present.

Since over 90 per cent of India's merchandise trade is carried by foreign ships, the new regulations will result in Indian traders paying higher charges to foreignshippingcompanies.

"Heavy and low-unit value goods would be more affected than light or high-cost goods. Shipping distance will also add to the cost," it said, adding both the directives force the global shipping sector to make heavy investments in reducing emissions.

It said that decarbonisation will require ships switching from using bunker fuel to low-carbon fuels like liquefied natural gas (LNG), methanol, andammonia.

"The sector also needs to invest in improving ship efficiency by optimising hull design, using efficient engines. TheInternationalEnergyAgency(IEA) estimates that it will cost USD 1.5 trillion to achieve net-zero emissions frominternationalshippingby2050,"the reportsaid.

It suggested that India's shipping sector must set aside over USD 100 billiontosurviveinalowcarbonfuture.