Norway has created a separate bank just to promote the shipping industry. Singapore also has a successful model. But India should follow neither, said Naveen Kolathur, Southern India Chamber of Commerce and Industry (SICCI) SCM’s co-chair, at THE WEEK Maritime Conclave 2024 in Chennai.
“They are small countries, so they can do many things,” he said. “If you look at India’s scale, a Singapore or a Norway model doesn't make sense. A good model I observed in the international markets is the Chinese model, where they have done two things. One, they collaborated with Singapore, and created a joint financing mechanism. In large ports like Shanghai, they invested themselves. They did not look for any partnerships. On the other hand, for the smaller ports, they took the PSA's help. So PSA International runs most of the smaller ports. The larger ports are with the Chinese.”
ESG compliance
He said Indian companies have a lot of catching up to do. “Germany has a supply chain due diligence act that they passed last January, which means any German company, even if it has a branch office in Germany, has to be ESG compliant. How many Indian companies are ready for this? I don't think we have done much. In fact, the German consul has been going around trying to educate our SMEs and how to be compliant with that law. Compliance is a big pain area; when we talk about ESG nobody talks about compliance. In the global compliance index we are a red country.”
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The Environmental, Social, and Governance (ESG) Index, also known as ESGI, is a tool that measures a country's risks in the areas of the environment, human rights, and health and safety. The ESG Index covers 183 countries and territories.
