Economist Zaidi Sattar has said the shipping industry of Bangladesh must be environment friendly to make a strong ground in the global market.
Zaidi, also chairman of the Policy Research Institute, made the remark at a seminar titled “Environment-friendly Shipbuilding and Industrialisation,” organised by the International Business Forum of Bangladesh (IBFB). The seminar was held on Saturday morning at Hotel Intercontinental in the capital.
In his keynote paper, the economist said the country will also have to ensure a proper work environment. In addition, the industry requires cash incentives, duty-free import facilities for raw materials, development of backward linkage industries, low-interest loans, capital support, and diversification in production.
He said if these measures are implemented, the ship export industry could become a billion-dollar export sector within three to five years.
At the same time, around 100,000 new jobs would be created in the sector during this period, Zaidi Sattar added.
Industries and housing and public works adviser Adilur Rahman Khan attended as the chief guest, while special assistant to the chief adviser (Ministry of Finance) Anisuzzaman Chowdhury was present as the special guest.
In the keynote paper, Zaidi Sattar stated that Bangladesh is less competitive in the large shipbuilding market, which is dominated by China, Korea, and Japan. However, Bangladesh holds significant potential in the small and medium-sized ship market.
The global market for multipurpose ships, feeder vessels, and ferries with a capacity of 12,000 DWT is worth approximately 115 billion dollars. If Bangladesh can capture even 1 per cent of this market by 2027, the sector could generate an annual income of 1 billion dollars (100 crore dollars). At present, Bangladesh has the capacity to build around 20 ships a year.
In the keynote paper, Zaidi Sattar also said, “Eighty per cent of global trade takes place by sea. The demand for shipbuilding depends on international trade. When global trade rises, the demand for shipbuilding also increases. Shipbuilding in Bangladesh is a labour-intensive and promising industry. If production can be diversified, Bangladesh will be able to compete in the market for small and medium-sized vessels. Demand in this sector fluctuates every ten years, and currently we are in an upward cycle. Therefore, now is the right time to focus on this industry.”
Addressing the seminar as the chief guest, adviser Adilur Rahman Khan said, “The world now demands environmentally friendly ships. Countries that can build and export such ships will lead the maritime economy of the future. The shipping ministry will work with shipyards on global green certification, the use of renewable energy, and the construction of eco-friendly vessels for the international market.”
In his speech as a special guest, Anisuzzaman Chowdhury said, “Industrialisation helps bring in new technologies. Since we are in the process of graduating from LDC status in the future, we must focus on diversifying exports. Although the shipbreaking industry involves environmental and health risks, it also has some positive aspects. As the shipbuilding industry depends on fluctuations in global trade, banks’ counter refund guarantees and insurance must be ensured to reduce uncertainty in this sector.”
Lutfunnisa Saudia Khan, president of the IBFB, delivered the welcome speech saying, "More than 50 ships made in Bangladesh are engaged in trade with 18 countries around the world. There is vast potential for earning foreign currency through the shipbuilding industry. However, a fund of USD 5 million is needed for the development of this sector. Low-interest long-term financing support must be provided for the development of eco-friendly infrastructure. At the same time, the cash incentive for ship exports should be raised from 6 per cent to 12 per cent. This will make it easier to compete with countries like India and Vietnam.”
At the seminar, IBFB director Shakhawat Hossain said, “This industry has huge potential in Bangladesh. We are competing with countries like India and Croatia in the commercial sector. To advance this industry, strategic policies and financial support from banks are required.”
Also speaking at the seminar were former IBFB President Humayun Rashid and founder Mahmudul Islam Chowdhury.