The ship-breaking industry in Bangladesh is undergoing a significant transformation, marking a shift from its controversial past toward a more regulated and safer future. Since its inception, the industry has been a vital pillar of the national economy, contributing to employment generation, steel production, and even the country's international reputation.
Once synonymous with hazardous working conditions, frequent worker injuries, and severe environmental concerns, the industry is now embracing reforms. Gone are the days when worker deaths, amputations, and tragic accidents were common headlines. The sector, which directly and indirectly supports around 150,000 to 200,000 people, has taken steps to improve safety and environmental standards.
Despite generating $100-120 million in annual revenue for the government and supplying raw materials to several allied industries, the ship-breaking sector is now facing a new set of challenges. These include meeting international compliance standards, ensuring sustainable investments, and adapting to global environmental regulations.
As the industry navigates this critical transition, the focus is no longer on survival alone -- but on evolving into a cleaner, safer, and more sustainable enterprise, while maintaining its crucial role in the national economy.
The Beginning of Shipbreaking in Bangladesh
The shipbreaking industry in Bangladesh got going in an unexpected way. In 1965, a devastating cyclone hit Chattogram, causing the Greek ship MV Alpine to wash ashore at Faujdarhat. After the vessel remained stranded for a long time, workers from Chattogram Steel Mills, with help from locals, began dismantling it. They eventually sold the salvaged parts, marking the unofficial start of shipbreaking in the country.
Over time, old ships from around the world started arriving at the Sitakunda coastline. What began as a one-time effort gradually evolved into a full-fledged industry. Shipbreaking became recognised as one of the key industrial sectors of the country. By the 1990s, Bangladesh had emerged as the second-largest shipbreaking nation in the world -- a status it maintained for years. Even today, Bangladesh dismantles around 30% of the world's decommissioned ships.
Worker Deaths Cast a Dark Shadow Over Bangladesh's Shipbreaking Industry
The shipbreaking industry in Bangladesh continues to operate under a cloud of controversy, with unsafe working conditions and excessive work hours plaguing it for years. But more alarming are the frequent worker deaths and severe environmental damage, which have earned the industry a notorious reputation both at home and abroad.
Even just three years ago, news of worker deaths in the shipbreaking yards was disturbingly common. Many workers faced not only fatal accidents but were also left permanently disabled. Beyond these accidents, prolonged exposure to asbestos and other toxic metals has led to chronic illnesses such as asthma and heart disease. A significant number of workers have lost their ability to work altogether, living bedridden lives dependent on inhalers.
These tragedies have devastated countless families, many of whom lost their sole breadwinners. A major reason behind the high death toll is the industry's failure to meet international safety standards. Compounding the problem are external pressures like the Russia-Ukraine war, foreign currency shortages, blacklisting, and the imposition of advance taxes-factors that often bring the industry to a standstill.
Fatal accidents in shipbreaking yards are primarily caused by falling steel plates, explosions, falls from heights, and negligence by both workers and management. As a result, Bangladesh's shipbreaking sector -- centered along the coastal belt of Sitakunda, Chattogram -- as repeatedly come under international scrutiny, drawing negative media coverage that tarnishes its image and deters potential investors. Some have even gone as far as to call it a "graveyard industry." According to available statistics, from 2015 to June 2024, at least 124 workers lost their lives in the shipbreaking industry. The deadliest year was 2019, which saw 23 fatalities. In one particularly harrowing incident in September 2023, a massive explosion at SN Corporation's Green Shipyard in Sitakunda claimed the lives of six workers and left six others permanently disabled. This was the first accident reported in a so-called "green" yard, leaving stakeholders deeply disappointed. In total, 2023 recorded the death of seven workers and serious injuries to 29 others. Between 2009 and 2023, the industry has seen a staggering 447 worker deaths.
Moreover, long-term health hazards remain a significant concern. Exposure to asbestos, heavy metals, and toxic gases continues to afflict workers with severe, chronic diseases. A 2017 study revealed that 33 workers had contracted asbestos-related diseases, with three deaths already confirmed. Alarmingly, access to medical care is extremely limited-only 4.15% of workers reportedly receive even basic medical attention.
These findings have been confirmed by the Bangladesh Institute of Labour Studies (BILS) and various other labour organisations, who continue to call for urgent reforms.
How long can such a deadly industry continue without accountability? The question remains unanswered.
Shipbreaking Industry Plagued by Problems, Workers' Demands Remain Unmet
Bangladesh's shipbreaking industry continues to grapple with a host of long-standing issues, as highlighted by labour organisations. Major concerns include unsafe working conditions, excessively long working hours, lack of proper medical treatment and compensation after accidents, employer negligence, and a culture of shifting blame onto workers. Additionally, workers often do not receive appointment letters, the national minimum wage is not implemented, and bonuses and other benefits are routinely denied.
Despite the industry's growth, operations in many yards remain outdated, lacking proper modernization. Due to the absence of genuine goodwill among owners, the recruitment process is frequently informal. In an attempt to avoid responsibilities, many yard owners hire workers through third-party firms, paying daily wages as low as BDT 300-500-an amount rarely seen in other industries.
Workers also report being deprived of festival allowances, timely payments, and the legal entitlements outlined in labour laws. Alarmingly, some yards continue to employ child labour, in clear violation of international labour standards. Over the years, various labour organisations have voiced these demands through protests and negotiations with the government and yard owners, but meaningful implementation has yet to occur.
Fazlul Haque Mintu, Coordinator of the Bangladesh Institute of Labour Studies (BILS), acknowledged recent improvements in the sector. "The emergence of green yards is a welcome development. Accidents and fatalities have decreased, which is undoubtedly good news," he said. However, he emphasized the need for a change in the mindset of yard owners.
"Forcing workers to work 12 hours but paying them for only 8 is inhumane," Mintu said. "Moreover, modernisation in green yards has led to job losses for many workers. Alternative employment options must be created for them."
He also pointed out that many previously injured workers were still not receiving proper treatment. "This must be addressed urgently. If negligence and a profit-driven mentality continue to dominate, even green yards will see accidents -- something that will ultimately harm the industry," he added.
Labour advocates urge the government and industry stakeholders to act immediately and sincerely to address these persistent issues and ensure the welfare of workers in the shipbreaking sector.
Transformation in Bangladesh's Shipbreaking Industry
Once marred by frequent worker deaths and recurring accidents, Bangladesh's shipbreaking industry is undergoing a major transformation. The sector, long criticized for poor safety and labour conditions, is now making strides toward improved standards and safety. Fatalities have decreased, and working conditions are gradually improving. However, new challenges have emerged.
A turning point came in 2023 when Bangladesh ratified the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (HKC). According to the agreement, from December 2025 onward, no shipyard will be allowed to import old ships from abroad unless it is certified as a "green yard" in compliance with international environmental and safety standards.
This shift has triggered a wave of modernisation in the industry, pushing many traditional operators out of the race due to their inability to make the significant investments required to go green. As a result, the shipbreaking business is shrinking in size but becoming more sustainable.
Once home to around 200 ship recycling yards, Sitakunda in Chattogram now has only 15 active yards. Among them, PHP Ship Recycling Industries, SN Corporation, KR Ship Recycling Yard, and four others have achieved official recognition as green yards. In total, an estimated Tk 2,000 crore (around $180 million) has been invested in this green transition.
The future of Bangladesh's shipbreaking industry now lies in the hands of those who have successfully adapted to international standards -- marking a new, more responsible chapter for the sector.
Challenges for Shipyard Owners: Investment Shortfall Hinders Greening Efforts
The push to make shipyards environment -- friendly is facing a major obstacle -- lack of investment. Industry owners are struggling with complicated procedures to secure loans from banks, while high interest rates are compounding the problem. Many entrepreneurs are reluctant to take on the risks associated with long-term investments, and government incentives are notably absent.
Barkat Ullah, CEO of S.N. Corporation, told The Financial Express that the shrinking ship-breaking industry has significantly reduced their business opportunities. "We used to have a larger client base, but that has now dropped significantly. Many rolling industries have shut down," he said.
He further pointed out that it now takes six to seven months longer than usual to obtain cutting permission for a ship, which increases the bank interest significantly. "This delay is putting business owners under serious financial pressure," he added.
Seven Green Yards Emerging in Sitakunda
Sitakunda is witnessing a significant shift toward environmentally sustainable ship recycling, with seven shipyards now achieving "green yard" status. The first to receive this recognition was PHP Ship Recycling Yard. Following that, Kabir Ship Recycling, SN Corporation, KR Ship Recycling, and three other yards have also met the green standards. In addition, 15 more shipyards are currently in the process of adopting green practices.
Zahirul Islam Rinku, Director of PHP Family and Vice President of the Bangladesh Ship Recyclers Association, stated that under the Hong Kong Convention, non-green yards will no longer be allowed to import ships after June this year. To transform active yards into green-certified facilities, significant investments in modern equipment and infrastructure upgrades are required. He emphasized that ship recyclers now face multiple challenges, including maintaining international standards, securing investment and loans, and protecting the environment.
Md. Taslim Uddin, owner of KR Ship Recycling Yard, said, "Business now is all about challenges. We are having to work much harder than before. Every parameter has to match international standards. I spent around Tk 30-35 crore to make my yard green, which was a huge expense. If the government provides easy-term loans, the industry can regain its strength."
The emergence of these green yards marks a crucial step toward making Bangladesh's ship recycling industry more sustainable and globally competitive.
Shipbreaking Industry in Crisis as Scrap Ship Imports Plummet Bangladesh's once-thriving shipbreaking industry is facing a severe downturn due to a sharp decline in the import of scrap ships in recent years. From 2001 to 2015, the country held the top global position in ship recycling, but the situation has drastically changed.
In July 2023, Bangladesh Bank imposed strict restrictions on opening large Letters of Credit (LCs), due to a dollar crisis, which significantly impacted scrap ship imports. The decision the shipbreaking sector -- valued at over Tk 100 billion (10,000 crore) -- virtually paralyzed.
Only 173 scrap ships were imported and dismantled in 2023, a figure that dropped further to just 144 in 2024 -- the lowest since 2005. This marks a stark contrast to 2021, when 280 vessels were dismantled. According to the Bangladesh Ship Breakers Association (BSBA), Chattogram shipyards have seen a substantial decline in scrap ship arrivals in the current 2024-25 fiscal year as well.
Government and Administration Step Up Oversight
The shipbreaking industry in Chattogram, once criticized for its safety violations and environmental impact, is now undergoing significant transformation. Shipon Chowdhury, Deputy Inspector General of the Department of Inspection for Factories and Establishments (DIFE) in Chattogram, stated that accidents have decreased notably compared to the past. "We are observing positive changes," he said. "Currently, we are focusing on the implementation of minimum wages for workers and ensuring they are not deprived of other benefits."
The industry, once mired in controversy, is moving toward a greener and safer future. However, the path ahead poses greater challenges, including the need for sustainable investment, adherence to international standards, and strict enforcement of worker safety.
The future success of the shipbreaking sector hinges on a collaborative effort between owners, workers, and the government. Through joint initiatives, this once-criticised industry may emerge as a model for environmentally responsible and worker-friendly practices.
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