By Vaishali Basu Sharma
- Regulatory and Environmental Hurdles in Bangladesh’s Shipbreaking Industry
Bangladesh maintained its position as the world’s top ship-breaking destination in 2024, despite a fall in imports of scrapped vessels compared to 2023. The country imported 130 ships for scrapping, marking a 23.53% decrease from the 170 ships dismantled in the previous year, according to data from the NGO Shipbreaking Platform (NSP). This decline brought imports to a six-year low, attributed to dollar constraints and subdued demand driven by economic challenges.
Previously, scrapped ships brought to Bangladesh weighed between 40,000 to 50,000 tonnes on average. However, recent imports have been much smaller, averaging about 2,000 tonnes, according to industry insiders. Despite assurances from the industry about improved safety measures and a reduction in accidents, rights groups remain concerned about the human and environmental risks associated with shipbreaking activities.
Bangladesh is the world’s largest dumping ground for end-of-life vessels, reflecting the country’s lenient enforcement of regulations, particularly in its hazardous ship-breaking industry. While the European Union Ship Recycling Regulation mandates that EU-flagged vessels can only be dismantled in EU-approved yards, the scrap yards in Chattogram do not meet these standards.
Up to a third of workers in Bangladesh ship-breaking yards suffer from asbestosis, a chronic lung disease caused by exposure to hazardous materials. Despite safety assurances from the industry, the risks remain significant.
According to a press release by the NGO Shipbreaking Platform, China led the way in dumping ships globally in 2024, with Chinese owners selling 71 vessels for dismantling in South Asia, 59 of which were beached in Bangladesh. While China has banned the import of waste domestically to improve its environment and citizens’ quality of life, its shipping industry continues to offload toxic waste on vulnerable communities in countries like Bangladesh.
In 2024, 80% of vessels were dismantled under substandard conditions on Bangladeshi beaches. Tragically, nine workers died and 45 were injured across South Asian yards due to unsafe practices. Among these, one of the worst incidents occurred in Bangladesh, where an oil tanker explosion at SN Corporation’s yard claimed six lives and critically injured six others.
The explosion on the oil tanker MT Suvarna Swarajya on September 7, 2024, in Bangladesh highlights the severe lack of international and national regulations, oversight, and labor rights protections in the shipbreaking industry, according to Human Rights Watch and the NGO Shipbreaking Platform. The blast killed six workers and left four critically injured. Workers have described the conditions as hazardous, with minimal safety measures provided by the management. A cutter reported buying his own protective gear while earning less than $1.50 per hour, below the minimum wage for shipbreaking workers. Despite repeated warnings, the Bangladesh interim government has failed to address S.N. Corporation’s alleged negligence, leaving workers at ongoing risk.
Bangladesh’s ship-breaking yards, located in Chattogram, saw record imports of 280 vessels in 2021, but numbers have fluctuated since then. Challenges such as a dollar crisis and declining sales have impacted the sector, according to Md Abu Taher, president of the Bangladesh Ship Breakers and Recyclers Association. The $6.5 billion steel re-rolling industry in Bangladesh relies on ship-breaking for only 10% of its steel. They are registering a downturn in business as public construction has declined.
The shipbreaking industry in Bangladesh has faced significant scrutiny for regulatory violations, particularly concerning environmental and labor protections. Despite being a major global hub for dismantling end-of-life vessels, the industry often operates under weak enforcement of both international and domestic regulationsDespite repeated warnings from the Bangladesh Inland Water Transport Authority (BIWTA), some shipbreakers in Chattogram reportedly continue operations without proper clearance, including dismantling ships and dredging sand, further exacerbating regulatory violations.
Being in the informal sector, Bangladesh’s ship recycling yards are also not always subject to controls or inspections for proper health and safety measures. And with many of the workers being under the age of 18, these jobs also violate the Minimum Age and Worst Forms of Child Labour Conventions of the ILO.
Due to the violation, the government agency is not only deprived of a lot of revenue every year, but also the biodiversity along the seashore is ruined. Toxic waste from dismantled ships, including hazardous materials like asbestos and heavy metals, is often improperly managed, leading to severe pollution of coastal areas and marine ecosystems.
The Hong Kong International Convention Bangladesh signed in 2023 for the safe and environmentally sound recycling of ships has made it mandatory for local shipyards to be green to be eligible to import scrap ships. Of the 50 shipyards Bangladesh has, only six have green certificates and 13 are in the process of becoming green, according to the data of the Bangladesh Ship Breakers and Recycling Association (BSBRA). As a result, most of Bangladesh’s active shipyards need a huge amount of equipment to upgrade their yards to green shipyards.
As Bangladesh handles the majority of end-of-life vessels in South Asia, the global shipping industry is closely watching its ability to responsibly manage the global volume of ship recycling.
To claim the title of a safe and environmentally sound recycler, Bangladesh must address several critical issues including developing yards that meet all regulatory requirements, implementing effective downstream waste management solutions and ensuring that workers are well-trained and proactive about health, safety, and environmental issues. As the industry faces financial challenges, particularly due to declining ship imports and economic uncertainty amidst the political upheaval in the country, safety and environmental regulations must remain a priority. (ITL)
Author
Vaishali Basu Sharma
postvaishali@gmail.com
*The author is an analyst on geopolitical and macroeconomic issues*