Taxing ship-breaking industry

Today, only three countries -- Bangladesh, India and Pakistan -- account for 70-80 per cent of the global breaking and recycling of oceangoing vessels. Sitakunda in Chattogram is the country's largest ship-breaking zone, where this industry has grown despite some challenges for yard owners, investors and money lenders. Thousands of workers are also engaged in the ship-breaking sector. The ship-breaking industry provides processed wood and furniture, contributing to reduction of pressure on local timber.

However, ship-breaking is yet to become a sustainable business. According to media reports, import of ships for recycling has declined by 35 per cent in recent months. Ship-breakers reportedly said doubling of duties -- to Tk 5,000 a tonne from Tk 2,600 a tonne -- has affected the industry. Terming the measure as a major impediment to their business growth, the entrepreneur of the sector reportedly said they would also not be able to compete with the neighbouring countries due to high tariff rate. Unless the duty rate is revised downward, this $2-billion industry would suffer. It is, therefore, recommended that the policymakers take necessary steps to save this industry.

Md. Amanul Islam

Dept. of Peace and Conflict Studies

The University of Dhaka