23 July 2012

Shipbreaking going on in full swing overcoming legal barriers:

Chittagong-based shipbreakers have imported 132 large recyclable ships weighing 1.5 million tonnes of iron plates during the first half of this year.

Shipbreaking and recycling is going on in full swing after overcoming the legal barriers which the industry faced for nearly two years.

The country's 125 shipbreaking yards had imported 145 ships weighing 1.7 million tonnes of iron plates in 2011. The import dropped significantly in 2010, disrupted by judicial activism, as environmental groups took the issue to court for dumping hazardous materials in the coast and exposing workers to toxic substances.

In the face of protest and obeying the court order, the government had suspended import of recyclable ships for about a year. Later, the government introduced new rules for ship breaking and formed a Ship Breaking Cell at the Ministry of Industries to implement the rules.

The Ship Breaking and Recycling Rules 2011 was issued in a circular on December 14, 2011.

Both the industry people and ministry officials said they are now working in unison, with their limited workforce, to ensure compliance with the new shipbreaking rules.

"A total of 132 ships got NOC (no objection certificate) for import while 72 were accorded cutting permission till June this year," president of Bangladesh Ship Breakers Association (BSBA) Hefazatur Rahman told the FE Friday.

The 1.5 million tones weighing ships were imported at a cost of about $760 million. The price has recently gone down in the international market.

Echoing Mr Rahman, Technical Adviser of BSBA Captain Salahuddin Ahmed said there are still some barriers from environment directorate which the shipbreakers are facing.

"We don't want to take certificate for each ship as ship is the raw material of the industry," he said adding according to the Environmental Protection Act 1997, certificate is mandatory for the industry or the project.

But the shipbreaking and recycling rules 2011 has made it mandatory of taking certificate for each ship. "It is not justified," he argued.

Industries Ministry has decided to call a meeting shortly where representatives from the Industries and Environment ministries and ship breakers are to fix a nominal fee for each ship.

Moreover, the tariff has become a great concern as the budget proposed to increase the tariff to Tk 1200 from Tk 1000 for per LDT, he said adding it would raise the cost of production resulting a hike in rod price.

Shipbreaking and recycling will go smooth further once the proposed Board is formed which is expected to remove the delay of procedures, said Mohammed Amzad Hossain Chowdhury, Managing Director of Rising Group, a leading shipbreaking yards.

The active shipbreaking yards at Sitakunda, 20 kilometres north of the port city of Chittagong, dismantled only 75 ships in 2010, more than 170 ships in 2008 and 150 in 2007. Bangladesh used to dismantle around 50 per cent of the ships sent to scrap-yards across the globe, according to BSBA.

The other leading players in shipbreaking are Turkey and China. The government gave shipbreaking the status of an industry in February this year as part of a long-term plan to promote labour standards and safe toxic management. The shipbreaking industry is the country's main source of iron and steel. Private re-rolling mills and steel mills melt the scrap dismantled from ships to produce mild steel rods, bars and angles.

Source: the financial express. By Monira Munni. 23 June 2012

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