BD set to become a large ship-owning country

http://www.thefinancialexpress-bd.com/more.php?news_id=122243&date=2011-01-08

BD set to become a large ship-owning country
Jasim Uddin Haroon

Bangladesh is now heading to become a big merchant ship-owning nation, which has already surpassed the number of these types of ships owned by Pakistan, Sri Lanka and Myanmar, officials and persons familiar to the trade told the FE.

They also said the number of ocean-going vessels has increased following favourable taxation policy and funding by local banks.

The local people have bought a record 12 vessels in 2010 alone. Bangladesh traders also bought 10 vessels in 2009, according to official statistics of Mercantile Marine Department.

Bangladeshi traders have so far purchased 65 vessels spending more than 1.0 billion US dollars, according to Bangladesh Ocean-going Ship Owners Association (BOSOA).

But traders and shipping companies registered 47 vessels in the country and the remaining 18 were listed in other countries.

Ship-owning companies have to register with the department concerned under Merchant Shipping Ordinance 1983.

Neighbouring India owns more than 300 vessels, while Pakistan, Sri Lanka and Myanmar on an average 22-25.

The department said local commodity conglomerate Abul Khair bought a ship, so far the largest in size, named MV Amsir worth 68000 tonnes (dead weight tonnes).

Brave Royal Shipping Management, a Chittagong-based company, tops the list with the highest number of vessels — eight.

The company’s MV Jahan Moni, hijacked during the first week of December last year with 25 crew by Somali pirates, is yet to be rescued.

Habibur Rahman, principal officer of Mercantile Marine Department, said: “The number of vessels increased significantly following government policy support.”

He also said local traders bought 22 vessels in the last two years, more than 35 per cent.

The government waived import and value added tax on purchase of ships in its budget placed for 2009-10.

Local banks like AB Bank, One Bank and Prime Bank have come up with funding purchase of vessels, mostly bulk carriers.

There is no scope for price manipulation while purchasing ships as its prices are controlled by international brokerage houses mainly in Singapore and London.

Shah Alam, chairman of Continental Liner Agencies, said: “We’re specialised in the trade and we have huge potential to become a leading ship- owning country in the world.”

Mr Shah Alam, who owns 6 vessels said: “Many commodity market players are also in the race to purchase ships to minimise their import cost and make their products competitive.”

Apart from Abul Khair, Akiz Group (Akiz Wave, 46640 tonnes) and sugar refinery Deshbandhu Group (Golam-e-Mustafa, 16210 tonnes) had also purchased ships in 2010.

Shah Alam, BOSOA vice president, however, said Bangladesh now pays around 6.0 billion US dollars each year as freight cost, for carrying goods to and from Bangladesh.

Bangladeshi ships now carry less than 10 per cent of its export-import goods, BOSOA statistics said.

“We urge the government to make relaxation of the ships’ age bar,” he added.

Local traders are now allowed to purchase ships, which are at best 25 years old.

However, sources at the Ministry of Shipping said they are planning to extend ships’ ages up to 30 from the existing 25 years, set in 2004.

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