World’s first global carbon pricing agreement

Current Context: The International Maritime Organization (IMO) has finalized the world’s first global carbon pricing agreement for the shipping industry to curb carbon emissions.

About the IMO Framework:

• Adoption: Passed through a rare vote, breaking IMO’s usual consensus-based tradition
• India’s Stance: India voted in favor of the agreement
• Objective: Aligns with the IMO’s 2023 Revised Strategy to achieve net-zero emissions by 2050

Key Features

• Carbon Pricing: Ships exceeding emissions thresholds will pay fees:
• $380/tonne for high-intensity emissions
• $100/tonne for lower threshold excess emissions
• IMO Net-Zero Fund: Fees collected will fund clean shipping and help vulnerable nations

Implementation:

• Framework enters force by March 2027
• Compliance by 2028 for ships >5,000 gross tonnage
• Revenue Target: Expected to raise $10 billion annually by 2030