Panaji: A steep hike in global oil prices may take a toll on the shipping industry of the country, experts feel.
“In the past, whenever the oil prices have hiked such rapidly, inevitably the shipping industry suffered. If world trade suffers, the depression sets in affecting the shipping industry,” former Secretary, Ministry of Shipping, M P Pinto told PTI.
The world has seen such a phenomenon on two occasions—first, during the oil shock of 1973 and second in 1979 when trade went through crisis—he added.
Globally, the cargo shipping industry has a fleet size of 55,000 and employs around 1.2 million people on-board.
A container is off-loaded from a ship docked at Jawaharlal Nehru Port , Navi Mumbai. Globally, the cargo shipping industry has a fleet size of 55,000 and employs 1.2 million people on-board.
Pinto said the industry might be able to bear the current shock as the situation is fine across the world.
“When world trade shrinks, we suffer, but currently Asian countries are doing better. There is momentum in world trade,” he said.
The former Secretary said if recession sets in, it will be difficult for shipowners, as the order-books of most shipyards are full till 2012.
The cargo shipping industry stakeholders and experts, who have converged in Goa to participate in the Indian Maritime Labour Convention (2006) conference and fifth regional seafarers welfare meeting, said the industry is at its prime.
“Very few vessels have been scrapped. World trade is booming and the industry currently needs more numbers of officers and seafarers,“ Dani Appave, senior maritime specialist from International Labour Organisation (ILO), commented.
“However, the situation may change in a few years’ time,” he feared.
The International Labour Organisation (ILO) during its 2006 Geneva conference has adopted a new chapter for maritime sector that will provide a comprehensive labour charter for seafarers.
Appave said only three nations have currently ratified the convention—Bahamas, Martial Islands and Liberia. The three contribute 20% of the world’s shipping cargo trade.
The convention will come in force after 30 ILO member-states ratify it with a total of at least 33% of world’s gross tonnage, he added.
The ILO has initiated the programme to enact legislation so that the convention is adopted giving security to the seafarers.
“One way is to sensitize stakeholders. There could be issues with shipowners but ultimately you need to amend the act,” Pinto said.
Indian shipping is governed by the Merchant Shipping Act, 1958, which has been amended several times. “The convention needs to be ratified and embedded in the current law,” he said.
Indian shipping industry is the seventeenth largest in the world which handles 9.12 million gross registered tonage (GRT).