Bangladesh: Ship-breakers stop old vessels import

Re-rolling mills and real estate businesses are going to face serious crisis as ship-breakers stopped importing old vessels for almost a month after a High Court directive. A High Court Division bench last month directed the ship-breakers to take no objection certificate (NOC) from the environment directorate. "We have stopped importing ship since the High Court directive was passed. It has become difficult for us to take NOC from the directorate," Zafar Alam, president of Bangladesh Ship-Breakers Association, told the FE.
"The ships available with us can feed the market for maximum two months and after that if there is no development we have to close our activities," Mr Alam said.
The sector annually supplies about 2.3 million tonnes of scrap iron, 0.35 million tonnes of furniture, emergency generators to different factories, motors and spare parts to the different users, and pay about Tk 7.0 billion revenue to the government exchequer.
About 700 re-rolling mills in the country are dependent on the raw materials to produce MS rod. If the price of the rod goes up, the real estate sector will suffer.
The environment directorate has asked the ship-breakers to comply with 22 conditions to get the NOC but at present they can comply with, at best, 15 to 16 conditions, he said.
"We asked the directorate to tell us how we can fulfil the rest five or six conditions and give us a breathing space of one year to comply with all the conditions," he added.
About 1.2 million people are directly or indirectly dependent on the sector.
The president blamed some non-government organisations for misguiding people and launching propaganda against the sector terming it an environment polluter.
"We supply about 0.35 million tonnes of furniture and one can imagine how many trees would be chopped to make this huge volume of furniture," he said.
Mr Alam said the ship-breakers imported 42 vessels last month (before the HC directive) but they cannot break them due to legal complications with the commerce ministry.
"We asked the commerce ministry to resolve the dispute so that we can break the ships as a huge amount of money is invested on the vessels," he said.
On an average import cost of each ship is about Tk 300 million and the breakers have taken a substantial amount of loan from banks to import those, he added.
A shipping ministry official said the commerce ministry should immediately take decision about the 42 ships that in the event of a cyclone or a tidal surge might create a serious dislocation in the operations of the Chittagong port as they are at the shore and accidents can happen anytime.
Department of Shipping gives vessel import permission but it has informed the ship-breakers that it would not give any permission unless they get clearance from the environment directorate, he added.
"The shipping directorate cannot violate the court directive," he explained.
About the recent moves to put the ship-breaking sector under industries ministry, he said, "It is recognised internationally that director general of shipping department is the focal point to handle ship-breaking activities."
If the government takes decision to shift the focal point to industries ministry, it will be disastrous, he said.