High-risk area boundary shifted from India’s coastline

TH10_BU_SHIPPING_2578542fThis revision of the HRA boundary back to its original state should thus greatly reduce the insurance costs of Indian shipping companies. In total, this could save the industry $25 million, a Shipping Ministry official.

This would greatly reduce insurance costs of Indian shipping companies

In a welcome move for Indian shipping companies, international shipping regulators on Friday revised the ‘high-risk area’ boundary in the Indian Ocean and have shifted it away from the India’s western coastline. The new boundaries will come into effect on December 1, 2015.

“European Union Chair of the Contact Group of Piracy off the Coast of Somalia (CGPCS) announced the revision of the limits of the piracy High Risk Area (HRA) with effect from December 1, 2015,” the Ministry of Defence said in a statement.

Indian shipping regulators and defence forces have been lobbying to redraw the eastern limit of the HRA since 2012 citing the fall in sea piracy, which reportedly fell to a six-year low in 2014.

The absence of piracy in the Indian maritime zones and adjacent seas, the security concerns and financial implications of an extended HRA led to India seeking a review of the HRA, with the support of numerous countries,” the statement added.

The existing HRA, which was put in place in 2010 due to the increased incidence of sea piracy near the Indian coast, covers most of India’s western coast. Its extension from the previous boundary led to a 300-fold increase in insurance costs borne by companies for their ships, which in turn let to a rise in the transactions costs of commodities coming to Indian ports.

“The extended HRA came near the Indian coastline up to as close as about 35 nautical miles from the baseline.

“This was an unwarranted encroachment into India’s EEZ (Exclusive Economic Zone),” the Ministry of Shipping said in a statement.

This revision of the HRA boundary back to its original state should thus greatly reduce the insurance costs of Indian shipping companies. In total, this could save the industry $25 million, a Shipping Ministry official told.

Apart from this, the extension of the HRA to India’s western coast also created security risks, which will now be addressed to an extent, the Defence Ministry said.

“The extension of the eastern limit of the HRA from 65 degrees E to 78 degrees E led to security concerns on account of the presence of private security personnel onboard merchant vessels transiting the piracy HRA, and the presence of floating armouries off the Indian coast,” the Ministry statement said.

The international body in charge of setting these boundaries, while welcoming the contraction of the HRA, stressed that sea piracy is not dead.

“As chair of the Contact Group I strongly welcome this development. It reflects the progress the international community and the shipping industry have jointly made in combating piracy.

“Piracy, however, is only contained, it has not disappeared and there is a need for continued vigilance,” Maciej Popowski, Deputy Secretary General of the European External Action Service and EU Chair of the Contact Group said.

Pin It

Leave a Reply

Your email address will not be published. Required fields are marked *