4 - Economics and Maritime Power

Summary

Economics and maritime power constitute the core of a state's role and stake in the current global order driven by globalization. The emergence of maritime power as the vanguard of globalization has reinforced the criticality of maritime infrastructure to countries that are increasingly reliant on the medium of sea for economic interdependence, growth and prosperity. Significantly, maritime power is the keel of economic globalization as it facilitates economic growth and investments in the maritime domain.

The economic dimension of maritime power pivots on the state's ability to sustain a vast merchant marine built around civilian shipping assets, port infrastructure to transact large volume of trade, ability to build ships to conduct maritime trade and the availability of a quality human resource that shapes and conducts maritime business. Economics and maritime power also provide for technology development and inflow of investments since these are primary determinants that ensure a sustained and continuous growth of maritime commerce. In its economic topography, maritime power has interlinked the littoral and the hinterland through various ports and industrial centres such as the Special Economic Zones. The transportation network built around roads, rail and inland waterways facilitate long-haul bulk and containerized cargo traffic thus creating a seamless supply chain connecting the hinterland to the littoral.

Economics and maritime power is also built on the maritime-technological-industrial capacity that pivots on technological sophistication, infrastructure based on information technology, and modern systems and processes for conduct of maritime commerce. In the contemporary global maritime-based trading, these capabilities gain greater credence, particularly when the system is built around “just in time” cargo that provides for sustained manufacturing of goods. Information technology is vital to the efficient functioning of maritime enterprises and its operations depend heavily on the integrity of information infrastructure in a highly competitive globalized trading system.

Economics and maritime power deal with marine resources, both living and non-living, that abound in the EEZ of the state. The marine domain is a very important source of food security to the state and needs to be guarded against exploitation by other states that tend to overfish and encroach into others’ EEZ. Preservation of the marine resources is also critical for the continued replenishment of the fishing economy of the state that constitutes a substantial slice of resources. Similarly, hydrocarbon constitutes a critical marine resource for the state's economic power.