There is a perception that the shipping industry is one of the most corrupt. Do you agree?
I wouldn’t concur entirely with that perception. While there is some truth to it, corruption in any industry is often a reflection of the larger societal environment. There is no documented, empirical evidence to claim that the shipping industry is the most corrupt. Corruption exists across sectors, and unless we address it systematically, it will continue to manifest in various forms.
How serious is corruption in the maritime industry, especially in the Indian subcontinent,?
The issue is significant. In 2011, the Maritime Anti-Corruption Network (MACN) was founded by Maersk to uphold business integrity. Today, MACN has grown into a global movement with over 220 companies committed to combating corruption. If India wants to achieve its economic growth goals and improve its ease of doing business ranking, tackling corruption is crucial.
Though the process is tedious and complex, we have made a start, and there is a growing awareness in the industry. Where does India rank in maritime corruption? There is no specific ranking for corruption in the shipping industry. However, global indices like Transparency International’s Corruption Perception Index rank India between 70 and 100 among 193 nations. Given that India is the world’s fifth-largest economy, this is entity, followed by port administrations.
How does MACN resolve complaints and authenticate reports?
We follow a rigorous vetting process. Once a complaint is received, we request documentary evidence such as ship logs, CCTV footage, audio recordings, or photographs. We assure confidentiality through a robust whistleblower mechanism. If a master has failed to comply with the law, we inform them that MACN cannot intervene. However, if an official is exploiting the situation for illicit gains, we escalate the matter immediately. I personally reach out to the highest-ranking officer in the relevant jurisdiction, ensuring a swift resolution, usually within four to five hours.
What actions have been taken against corrupt officials?
In most cases, we have successfully recovered concerning. It calls for serious introspection by policymakers and the industry. MACN focuses on corruption at ports, involving customs, immigration, quarantine, port state control, and maritime administration. We operate globally in eight key jurisdictions, including Nigeria, Argentina, Ukraine, Indonesia, Egypt and South Asia (India, Bangladesh and Pakistan). We also have a reporting mechanism through a help desk, where ships can notify us of corrupt practices.
What are the major pain points reported by the shipping industry?
The most common grievances involve customs and immigration. Issues range from delays in granting port clearance to demands for bribes. Some cases arise due to incomplete or incorrect declarations by shipmasters, which customs officials can legally act upon. However, we have seen instances where officials exploit these situations for personal gain. Customs is the most frequently reported extorted money and had apologies tendered. Some officials have been transferred to non-sensitive positions, while others have faced departmental disciplinary action. Our interventions have led to a 100 per cent success rate in reported cases.
What reforms have you proposed to tackle systemic issues?
We have submitted policy recommendations to the government, focusing on business process re-engineering. Two key proposals include: Digitalizing Port Clearance (PC): Currently, PC is issued manually by customs officials, often leading to delays and corruption. We recommended making PC applications electronic, integrating them with an e-payment gateway. This proposal has been accepted and is being implemented under the National Logistics Portal (Marine).
Single-Window Reporting: Ships currently submit redundant information to multiple agencies (customs, immigration, port health, etc.), leading to inefficiencies. We proposed a centralized electronic submission system, aligned with IMO’s Facilitation (FAL) Convention. This, too, is being adopted by the Indian government.
What should public and private stakeholders do to curb corruption?
MACN has engaged extensively with both the private sector and government agencies. We have held over 155 interactions with industry stakeholders and 128 high-level meetings with government bodies, including customs, immigration, the Ministry of External Affairs, and major port authorities. Private sector companies must actively engage with MACN and ensure their crews file Pre-Arrival Notices (PANs) with us. Currently, only about 2,100 PANs are filed annually, compared to 25,000 port calls, which leaves us blindsided in many cases. On the government side, we have conducted training workshops for customs officials to sensitize them. There is a growing recognition that corruption must be tackled, and our efforts have led to an improved port user experience.
What has been the overall impact of MACN’s initiatives in India?
The results have been promising. We have successfully resolved 41 cases, recovering millions of dollars for the industry. More importantly, our interventions have ensured that vessels sail on time, avoiding additional operational costs. MACN’s initiatives have potentially saved the industry around $6 million in avoided delays and extorted payments. While much remains to be done, we are making steady progress in transforming India’s maritime sector into a more transparent and efficient space. This is a long journey, but we are on the right path.
