India and 62 Countries Support Global Carbon Tax to Cut Shipping Emissions

India and 62 other countries have agreed to support a new carbon tax on international shipping emissions. The decision was made at a recent meeting of the United Nations’ International Maritime Organization (IMO), where countries voted to move forward with the world’s first global carbon pricing system for the shipping industry.

The goal of this new policy is to reduce the pollution caused by ships, which are responsible for about 3% of the world’s greenhouse gas emissions. The tax is expected to encourage shipping companies to switch to cleaner fuels and adopt greener technologies.

The carbon tax is expected to be formally adopted in October 2025, after final discussions and technical rules are completed. Once in place, the tax will be applied from 2028.

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Under the plan:

• Ships that continue using traditional fossil fuels will have to pay $380 per tonne of carbon dioxide emitted for the most polluting portion of their emissions.
• An additional $100 per tonne will be charged on the rest of the emissions above a certain limit.
• Alternatively, shipping companies can avoid the tax by switching to low-carbon or cleaner fuel options.

The policy is expected to raise between $30 to and $40 billion by 2030, which may be used to support the transition to cleaner shipping and help developing countries.

The tax plan was supported by 63 countries, including India, China, Brazil, Japan, South Africa, the European Union, and Singapore.

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Some major oil-producing countries, such as Saudi Arabia, the United Arab Emirates (UAE), Russia, and Venezuela, opposed the tax. These nations argued that the policy could hurt their economies and trade.

Although this is a historic agreement, experts say it may not be enough to meet the IMO’s climate targets. The tax is expected to reduce shipping emissions by only 10% by 2030, while the IMO’s strategy calls for at least a 20% reduction, and ideally 30%.

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Shipping was not included under the Paris Climate Agreement, so this carbon tax is one of the first serious global steps to address emissions from the maritime sector. It creates a common international rule for all ships, no matter where they are from, making it a significant climate policy milestone.

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The new tax also raises important questions about how the money will be spent and whether countries like the United States, which did not fully support the plan, might respond with retaliatory actions or push for changes.

The final version of the policy will be discussed over the coming year, and the IMO is expected to officially adopt it in October 2025. After that, the carbon tax will start from 2028, giving shipping companies time to adjust.

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