Why Kerala has claimed ₹9,531 crore in compensation from MSC
Fishermen approached the court seeking compensation alleging the floating containers are damaging their fishing gear. The HC has ordered detention of five cargo ships MSC Polo, MSC Manasa F, MSC Akiteta II, MSC Palermo and MSC Makoto for payment of compensation. While the ship owners produced bonds and ensured release of three vessels, MSC Akiteta II continues to be anchored at Vizhinjam as the company has expressed inability to pay the USD $1 billion compensation.
According to the Kerala government, the maritime claim arises from environmental pollution and damage to the coastline, economic loss caused to the fishing community and expenses incurred by the state in mitigating the consequences of the incident.
The state calculated the compensation based on scientific inputs and departmental reports, which include ₹8,626.12 crore towards pollution damage, ₹378.48 crore for environmental restoration and ₹526.51 crore for economic loss to fishermen, aggregating to a total claim of ₹9,531 crore. Interest at the rate of 6% per annum should be collected from date of suit till judgment and 12% till realisation thereafter. As many as 61 containers washed ashore along the districts of Thiruvananthapuram, Kollam, Alappuzha and Ernakulam and 59.6 metric tonne of plastic nurdles have been collected and transported from the coastline. The state deployed 600 government personnel and 300 volunteers for manual and mechanical cleaning.
Financial relief of ₹1,000 per person was distributed to 78,498 fishermen families and 27,020 families in the allied sector. A free ration of 6 kg rice per head was also distributed. Contamination led to the crash of the fish market as people were not ready to purchase fish fearing chemical contamination. Six Cetacean carcasses including dolphins and a whale beached along the shoreline due to suspected exposure to toxic substances, the state said in the admiralty suit.
MSC Elsa 3 built in 1997, began listing on May 24 and submerged the next morning. The incident resulted in massive pollution of Kerala marine ecosystem with oil slicks and floating containers causing serious detriment to the environment, coastal fishing and public health. The vessel carried 643 containers including 13 containers of hazardous cargo and plastic pellets known as nurdles.
'The discharge of marine diesel from sunken ship MSC Elsa 3 can form surface slicks blocking sunlight penetration. This will suppress photosynthesis of phytoplankton, destabilising the marine food web. Oil exposure can impair fish respiration and smother benthic organisms. Hazardous chemicals like hydrobromic acid, paraformaldehyde and methyl methacrylate can alter seawater chemistry. Potassium nitrate can trigger harmful algal blooms depleting oxygen and creating dead zones. Bipyridylium pesticide is highly toxic to fish, planktons and marine microorganisms. Even minimal exposure can disrupt aquatic ecosystems and impair reproductive and respiratory functions in marine fauna," said Kerala University of Fisheries and Ocean Studies (KUFOS) former vice chancellor and scientist B Madhusoodana Kurup.
The ship's owners strongly contested the Kerala's ₹9,531 crore compensation claim, arguing that the state has no legal standing in the matter and that environmental or economic damage have not been proven. In a detailed counter affidavit, the company claimed that the vessel had sunk outside the state's territorial waters and the jurisdiction of the Kerala government. Therefore, the state government lacked the locus standi to file the claim, they argued. The company refuted all allegations of marine pollution or damage to fisheries. It stated that only 13 containers on board Elsa 3 contained dangerous goods, and none of them had fallen into the sea. The affidavit emphasised that there was no release of hazardous chemicals and denied any discharge of pollutants, except for plastic nurdles.
The MSC disputed the compensation claim for loss of fishermen's livelihoods, arguing that the claims were speculative and legally untenable. The Union government holds exclusive jurisdiction over fisheries and has not imposed any fishing ban. The company alleged that Kerala's claim is 'grossly exaggerated, fanciful, and unsubstantiated".
The ship operators urged the HC to limit their liability to maritime claims arising from the shipwreck. Meanwhile, Sri Lanka has also sought compensation, claiming that the debris has reached its coastline.
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New Indian Express
9 hours ago
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Why Kerala has claimed ₹9,531 crore in compensation from MSC
A protracted legal battle between Kerala and Mediterranean Shipping Company (MSC) over the sinking of MV MSC Elsa 3 off Kerala coast is on the cards. Kerala filed an admiralty suit in Kerala High Court demanding a compensation of ₹9,531 crore while the MSC has argued that the state has no legal claim as the ship sank outside the territorial waters. MSC Elsa 3, a container vessel sank into the depths of the Arabian Sea around 14.6 nautical miles off Thottappilly harbour on May 25, 2025. Fishermen approached the court seeking compensation alleging the floating containers are damaging their fishing gear. The HC has ordered detention of five cargo ships MSC Polo, MSC Manasa F, MSC Akiteta II, MSC Palermo and MSC Makoto for payment of compensation. While the ship owners produced bonds and ensured release of three vessels, MSC Akiteta II continues to be anchored at Vizhinjam as the company has expressed inability to pay the USD $1 billion compensation. According to the Kerala government, the maritime claim arises from environmental pollution and damage to the coastline, economic loss caused to the fishing community and expenses incurred by the state in mitigating the consequences of the incident. The state calculated the compensation based on scientific inputs and departmental reports, which include ₹8,626.12 crore towards pollution damage, ₹378.48 crore for environmental restoration and ₹526.51 crore for economic loss to fishermen, aggregating to a total claim of ₹9,531 crore. Interest at the rate of 6% per annum should be collected from date of suit till judgment and 12% till realisation thereafter. As many as 61 containers washed ashore along the districts of Thiruvananthapuram, Kollam, Alappuzha and Ernakulam and 59.6 metric tonne of plastic nurdles have been collected and transported from the coastline. The state deployed 600 government personnel and 300 volunteers for manual and mechanical cleaning. Financial relief of ₹1,000 per person was distributed to 78,498 fishermen families and 27,020 families in the allied sector. A free ration of 6 kg rice per head was also distributed. Contamination led to the crash of the fish market as people were not ready to purchase fish fearing chemical contamination. Six Cetacean carcasses including dolphins and a whale beached along the shoreline due to suspected exposure to toxic substances, the state said in the admiralty suit. MSC Elsa 3 built in 1997, began listing on May 24 and submerged the next morning. The incident resulted in massive pollution of Kerala marine ecosystem with oil slicks and floating containers causing serious detriment to the environment, coastal fishing and public health. The vessel carried 643 containers including 13 containers of hazardous cargo and plastic pellets known as nurdles. 'The discharge of marine diesel from sunken ship MSC Elsa 3 can form surface slicks blocking sunlight penetration. This will suppress photosynthesis of phytoplankton, destabilising the marine food web. Oil exposure can impair fish respiration and smother benthic organisms. Hazardous chemicals like hydrobromic acid, paraformaldehyde and methyl methacrylate can alter seawater chemistry. Potassium nitrate can trigger harmful algal blooms depleting oxygen and creating dead zones. Bipyridylium pesticide is highly toxic to fish, planktons and marine microorganisms. Even minimal exposure can disrupt aquatic ecosystems and impair reproductive and respiratory functions in marine fauna," said Kerala University of Fisheries and Ocean Studies (KUFOS) former vice chancellor and scientist B Madhusoodana Kurup. The ship's owners strongly contested the Kerala's ₹9,531 crore compensation claim, arguing that the state has no legal standing in the matter and that environmental or economic damage have not been proven. In a detailed counter affidavit, the company claimed that the vessel had sunk outside the state's territorial waters and the jurisdiction of the Kerala government. Therefore, the state government lacked the locus standi to file the claim, they argued. The company refuted all allegations of marine pollution or damage to fisheries. It stated that only 13 containers on board Elsa 3 contained dangerous goods, and none of them had fallen into the sea. The affidavit emphasised that there was no release of hazardous chemicals and denied any discharge of pollutants, except for plastic nurdles. The MSC disputed the compensation claim for loss of fishermen's livelihoods, arguing that the claims were speculative and legally untenable. The Union government holds exclusive jurisdiction over fisheries and has not imposed any fishing ban. The company alleged that Kerala's claim is 'grossly exaggerated, fanciful, and unsubstantiated". The ship operators urged the HC to limit their liability to maritime claims arising from the shipwreck. Meanwhile, Sri Lanka has also sought compensation, claiming that the debris has reached its coastline.
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