A strategic partnership between India and Greece can balance China’s inceasing influence on shipping and global trade
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This article is part of the essay series “Sagarmanthan Edit 2024”
The Greek professor of Geopolitics at the University of Athens, Dr Ioannis Mazis, stated: “Trade drives economies and affects both political and geopolitical changes. Whoever is responsible for the control of trade flows on the field (control of the supply of commodities) inevitably controls the economy overall, and whoever controls the economy overall has the power to control nations and affect geopolitical changes worldwide. In other words, they possess the ultimate power to govern the planet.”
Oceans, seas, and coastal areas contribute to food security and poverty eradication. Over 3 billion people use the oceans for sustenance and 80 percent of world trade occurs over the seas.
Greece, which is surrounded by the Aegean, Ionian, and Mediterranean Seas, has developed a robust shipping industry. Since ancient times, the Greeks have understood the value of overseas trading and have developed sea trade by advancing shipbuilding, navigation, and cargo trading. These developments allow a small country like Greece to become the leader of the world’s shipping industry by servicing other countries’ import and export of goods.
Since ancient times, the Greeks have understood the value of overseas trading and have developed sea trade by advancing shipbuilding, navigation, and cargo trading.
In the current increasingly multi-polar world, countries with the biggest economies are facing uncertainty due to changing dynamics and various conflicts of interest within geopolitical, economic, energy, and technological landscapes. As a result, existing alliances cannot be taken for granted. Since every country is looking to strengthen its economy, minimise its reliance on other countries, and reduce vulnerability to external factors, countries must continually innovate and develop.
The imports and exports of each country support its food supply and infrastructure which, in turn, leads to the country’s growth and development. Imports and exports are defined by a country’s trading ability when dealing with other countries. To be efficient, the purchase or sale of goods and commodities must be cost-effective. One of the key parameters of cost-effectiveness is transportation cost; having a shipping industry efficiently manages transport costs since 80 percent of global trade travels by sea. Other factors that affect cost-effectiveness are the flow of the worldwide supply chain as well as any sanctions that might occur.
There are five influential shipping nations: Greece, Japan, China, Singapore, and Hong Kong. Between the five of them, they control 53 percent of the world’s total tonnage. Greece is a strategic partner of major trading nations. Its merchant fleet services over 22 percent of the United States’ (US) imports and exports, over 20 percent of European trade and 32 percent of Asian trade. This makes the Greek shipping industry one of the cornerstones of the world economy and trade, and at the same time, a pillar of the Greek economy.
One of the key parameters of cost-effectiveness is transportation cost; having a shipping industry efficiently manages transport costs since 80 percent of global trade travels by sea.
The Greek shipping industry has motivated other countries to develop their shipbuilding and ship repair, technology, marine services, ship spares, and equipment. Consequently, the Greek shipping industry has contributed to the economic growth of these countries. For example, Greece has bought 1,500 ships from Chinese shipyards since 2000, contributing to the Chinese economy with US$ 70 billion. This does not account for the additional revenue from ship repairs every year.
Over the last 15 years, China has become an aggressive player in the global shipping industry. It has not only succeeded in drastically increasing its merchant fleet size but has also entered the global cargo trading sector, controlling management stakes in over 117 strategic ports in 43 countries around the world with an additional 12 ports in development. This has increased China’s influence over maritime logistics, positioning it to potentially dominate the global supply chain.
In this challenging world, Greece and India must join forces to develop the Indian shipping industry and increase global competition. The development of India’s own merchant fleet will strengthen India’s position in global trading. Furthermore, collaborative projects would be mutually beneficial. These include the creation of new shipyards in India for shipbuilding and ship repair, the exchange of ship technology, and training and employing more Indian seafarers.
To develop the Indian shipping industry, certain important steps must be adopted towards building supporting infrastructure.
To develop the Indian shipping industry, certain important steps must be adopted towards building supporting infrastructure. This includes the construction of ports, terminals, warehouses, shipyards, ship suppliers for bunkers, stores, spare parts and workshops, among others. For this infrastructure to be successfully developed, it needs sufficient public and private investment, provided that India’s legislation will be favourable and allow investors to develop their projects .
Since Piraeus is the hub of the global shipping industry, establishing a team that would promote India’s interests will prove to be beneficial. This team could consist of observers who track the day-to-day developments and changes in the global shipping industry, collecting valuable insight, formulating India’s own maritime strategy, and managing an Indian-owned fleet.
Every two years, Greece connects the world’s countries at the Posidonia Exhibition, which is the largest shipping exhibition in the world. This year, over 81 countries were represented, with 2,038 participants. A larger Indian presence in the ever-expanding and changing shipping industry will be a significant development.
Stella Mantzari is the Founder and Chief Executive Officer of AS Marin Ltd.
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Stella Mantzari is the Founder and CEO of AS Marin Ltd. She has 15 years of experience in managerial positions in four major Greek shipping ...
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