Bangladeshi Scrap Ship Importers Allowed to Buy 24 Old Ships following HC Verdict:

The Department of Shipping has so far permitted importers to purchase 24 old ships following a High Court (HC) verdict that ended difficulties and embargo the industry faced for nearly one year.

In the verdict, the official copy of which was issued on April 7, the HC said the ban order on old ships import should go as Prime Minister Sheikh Hasina has declared it as an industry. It also said the industry is important as it supplies raw materials for MS rod manufacturing and inland boat building.

Senior consultant of Bangladesh Ship Breaking Association (BSBA), Captain Anam Chowdhury, told the FE Monday: "Shipbreakers have already opened letters of credit (L/Cs) to purchase scrap vessels."

Mr. Anam said the 24 vessels weighing about 250,000 tonnes have been purchased at a cost of US$ 130 million and are likely to arrive within the next few weeks.

The BSBA consultant said some 30 old ships imported earlier are now awaiting dismantling.

Meanwhile, former president of the BSBA Zafar Alam said, "We're expecting to sign deals to purchase 20 more ships as soon as possible."

He also said the HC has asked the government to prepare a detailed guideline for the industry within the next 2 months.

The shipbreaking sector had been facing hurdles over import of old vessels since 2009 due to legal issues which caused reduction in their imports.

The country's 72 shipbreaking yards had imported 175 ships weighing 2.2 million tonnes of iron plates in 2009.

The imports dropped significantly in 2010. The shipbreakers imported only 1.3 million tonnes of iron plates last year.

The chairman of Ratanpur Ship Recycling Industry, M Rahman said: "We think that we all should now concentrate on the business following the verdict."

Sitakundu in Chittagong emerged as the world's largest shipbreaking destination as Bangladeshi importers had beaten their competitors in India and Pakistan to buy the highest number of scrap vessels sold in the international market during 2007-2009 period.

The active shipbreaking yards in Sitakundu, 20 kilometres north of the port city Chittagong, dismantled more than 130 ships in 2007.

Bangladesh used to dismantle around 50% of the ships sent to scrap-yards across the globe, according to BSBA.

The other leading players in shipbreaking are Turkey and China.

Source: The Financial Express. By Jasim Uddin Haroon. 12 April 2011

http://www.thefinancialexpress-bd.com/more.php?page=detail_news&news_id=132252&date=2011-04-12