Government to implement sustainability index to ascertain exit age of Indian ships

The government will implement a sustainability indexing of ships to determine the exit age of Indian ships rather than the previous decision to restrict older tonnage solely on the basis of age. As it considers a more comprehensive plan to replace and renew the Indian fleet while keeping in mind the impending international ship emissions regulations.

The action is a component of the “Revised Age Norms and Sustainability Indexing for Ships,” which was created for stakeholder engagement by the nation’s maritime regulator, the Directorate General of Shipping.

While the age of ships for entry into and exit from the Indian ship registry has largely been retained from the February 2023 order, fleet owners can continue to operate ships beyond the maximum age limit prescribed based on the points scored out of a total of 125 in sustainability indexing which takes into account 17 different criteria. The entry age for second hand oil tankers, bulk carriers and general cargo vessels into the Indian registry has been set at 20 years and they can be run till 25 years. For offshore fleet, the entry age has been set at 20 years which will be allowed to run till 25 years, except for DP2 vessels which can ply for 30 years.

The entry and exit age for exclusive container and cement carriers into the Indian registry has been set at 20 and 30 years, respectively. In the case of gas and chemical carriers, the entry and exit age will be 25 and 30 years, respectively.

For harbour tugs operating within a harbour/port, the entry and exit age has been set at 20 and 30 years, respectively. In the case of anchor handling tugs and tugs involved in long tow as well as non-self-propelled ocean-going cargo carrying barges (dumb barges), the entry and exit age is 20 and 25 years, respectively. The age norms will not be applicable to specialised and complex vessels of higher cost and lesser availability such as passenger vessels, FSRU, FPSO, heavy lift installation barge, crane barge, pipe laying vessel, cable laying vessel, research vessel and floating docks, dredgers, Dynamic Positioning 2 or DP2 diving support vessels, DP2 well stimulation vessels and drilling/production units certified under MODU/SPS Code.

 However, as in the case of other vessels, the vessels exempted from age norms will have to comply with the sustainability indexing for its continuation under Indian registry by March 31, 2028. The age and other qualitative parameters will also be applicable to foreign flag vessels requiring license under Sec 406 and 407 of the Merchant Shipping Act, 1958, for operating within the Exclusive Economic Zone of India.

In such cases the maximum age of the vessel shall be determined as on the date of commencement of service or cargo carriage, as the case may be. Foreign Flag vessels exceeding the entry age will not be considered for issuance of license. The age norms will also apply to so-called ‘Indian Controlled Tonnage’ vessels carrying coastal cargo or providing services within the Exclusive Economic Zone of India. Vessels acquired/to be acquired under the ‘Indian Controlled Tonnage’ regime would also be treated as Indian flag vessels. The ‘Existing Vessels’ regardless of their age on the date of issuance of the order (yet to be specified), affected by the maximum age prescribed, will be allowed to operate until March 31, 2028, and their further operation is subject to compliance with the sustainability indexing.

The criteria for calculating the sustainability index includes carbon emission reduction, EEXI compliance, shore power readiness, biofuel/low carbon fuel integration, energy efficiency devices, nitrogen oxides and particulate matter emissions compliance, port state control (PSC) and flag state inspection (FSI) performance benchmark, detention under PSC/FSI, condition of class, major non-compliance in SMC and DOC audit, casualty reporting, green ship recycling commitment, conditions based rating (CAP/RightShip/OVID/IRS Equivalent), optional supplementary global rating (if more than one available), additional environmental protection equipment and a year on year substantial improvement in sustainability index which fetches a 5 points bonus mark.

A score of 65-80 points will be eligible for a one-year conditional extension to demonstrate improvement to a higher score. It will not be eligible for any further extension from the cut-off age, if it fails to improve. Those scoring less than 65 points will not be eligible for extension beyond March 31, 2028, the date set for complying with the age norms and sustainability index. If a ship fails to maintain the rating score in one particular year, it falls to the lower grade forthwith and should demonstrate continuous higher score for two consecutive years for upgradation of rating.