Russia’s icy shipping route gamble gets India-China boost: Can NSR really challenge Hormuz?

Sea Legend, a Chinese shipping company, on Saturday, begins the first regular service along the Northern Sea Route (NSR), a vital Arctic maritime corridor that Moscow is seeking to develop into a major trade link between Europe and Asia

Running between Ningbo in eastern China and Felixstowe in Britain, the service is expected to take 20 days —about half the time it takes for shipments from China to Europe via the Suez Canal.

Though other shipping companies have transited the Arctic passage before (Denmark's Maersk was the first to do so in 2018), Sea Legend will become the first operator to run a regular container service through the NSR, for a seven-week period until October 3.

Putin, Xi push Arctic trade

Russian President Vladimir Putin has long envisioned the 3,500-mile route along Russia’s jagged Arctic coastline becoming a major artery for trade – and a driver of investment in Russian ports and oil and gas fields.

In recent months, he’s claimed that disruptions to trade due to fighting around the Red Sea and the Strait of Hormuz show that the seasonal route is the safest, most reliable, and most efficient.

China has also been looking at the Arctic as a new trade route for years. Xi Jinping has long envisioned a ‘polar Silk Road’ across the Arctic, an icy extension of his flagship Belt and Road infrastructure drive.

India wants in!

A Russian official exclaimed earlier this week that India is among the countries holding the "most productive" talks with Russia for cooperation in the Arctic region

"The most productive dialogue is taking shape with China and India, which not only demonstrate interest in the Arctic agenda but also possess extensive resources for implementing joint projects and initiatives in this area," Vladislav Maslennikov, Director of the Department of European Problems at the Russian Foreign Ministry, said.

Ministry of External Affairs also confirmed on Friday that India and Russia are currently engaged in active deliberations to deepen bilateral cooperation along the Northern Sea Route (NSR)

MEA spokesperson Randhir Jaiswal said improving transport links is an important part of India’s cooperation with Russia, adding that both countries are already discussing the Northern Sea Route.

Responding to a query on the subject, Jaiswal stated, "With Russia, we have a multi-faceted cooperation of which connectivity is an important part. We have been discussing this particular issue with them as well. So this is something that is ongoing."

Can NSR become an alternate route to Hormuz?

Many firms have pledged to avoid regular routing in the area due to the risk of accelerating ice melt.

Major shipping companies, including France's CMA CGM, Switzerland-headquartered MSC and Germany-based Hapag-Lloyd, have signed a US-based nonprofit's pledge to "avoid Arctic trans-shipment routes", which include the NSR.

"Though these routes can offer decreased transit times, increasing vessel traffic on Arctic shipping routes poses great risk and potentially devastating environmental impacts," reads the Ocean Conservancy website.

However, analysts say the Arctic is an important future trade route, particularly for China. The period up to October 3 is "broadly aligned with the period when ships can expect to transit without icebreaker assistance", Niels Rasmussen, chief shipping analyst at the shipping lobby BIMCO, wrote in a note.

But whether it can become an alternative route to Hormuz is too big a question, and too far-fetched. Still, Russian President Vladimir Putin has reiterated Moscow’s willingness to work with other countries on developing the Arctic route.

“Russia has always advocated and continues to confirm its readiness to cooperate in the Arctic and to use the Northern Sea Route. Of course, within the framework of existing international maritime law,” Putin was quoted as saying by TASS at Pacific Fleet exercises.