New policy on shipbuilding soon: minister

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New policy on shipbuilding soon: minister
Star Business Report

The government will finalise the policy for shipbuilding and shipbreaking sector by the next two months in a bid to accelerate the growth of the promising sector, Industries Minister Dilip Barua said yesterday.

Barua said, “We are working to put the policy in place to ensure environment fri-endly and sustainable growth of the sector.”

The minister was addressing a workshop on “Identifying Regulatory Barriers and Improving Transference in Ship Building Industry”, organised by International Business Forum of Bangladesh (IBFB) at Sheraton Hotel in Dhaka.

He said the government is working over a ship industry promotion council to give policy support to the shipbuilding sector.

The IBFB also disclosed findings of a report on Bangladesh shipbuilding industry at the advocacy workshop. Suhel A Choudhury, former secretary of commerce and shipping ministries, led the six-member committee constituted by the IBFB.

The committee suggested three sites for establishing a special shipbuilding zone. These are East bank of Karnaphuli river, Meghna Ghat area and Chalna basin.

The special economic zone should have technical and geographical facilities including a deep channel with 200-plus metres height of bridges on the rivers and good electricity and gas supply for a fully export-oriented shipbuilding industry, said Choudhury.

The report also identifies some financial constraints — high interest rates, credit ratings of local banks and barriers to hire foreign experts.

Choudhury said, “The cost of generating bank guarantees from local banks is a huge burden for this sector as they have to pay about 6 to 7 percent interest.”

Poor inland water transport facility is another barrier for the development of the shipbuilding sector, said Choudhury.

About 90 percent exports and imports of Bangladesh are executed by sea because inland water transportation system was neglected, he added.

However, the report said, the newly emerging Bangladesh shipbuilding can become the next major export sector if the government formulates and executes a properly designed policy framework.

Public-private partnership may be encouraged in this sector and some existing state-owned shipyards may be put to use to their fullest capacities, said Choudhury.

The report also suggested that Bangladesh Bank should introduce refinancing scheme at a lower interest rate and provide industrial loans and working capitals for setting up new shipyards as well as expansion of existing units.

Speaking as a special guest, Abdul Mannan Howlader, secretary of ministry of shipping, said the inland container port will start operation from this year.

German Ambassador to Bangladesh Holger Michael said Bangladesh should develop and nurture the shipbuilding industry to turn the country into a major economic hub as it has potentials to grow.

Mahmudul Islam Chowdhury, president of IBFB, said shipbuilding industry has a possibility to grow like the readymade garment sector as the country has cheap labour available.

Western Marine Managing Director Sakhawat Hossain urged the government to formulate a proper policy to support the sector as it will give Bangladesh a new name as a shipbuilding nation in the global market.

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