In its latest quarterly publication, the NGO Shipbreaking Platform informs about the shipbreaking industry in Bangladesh, India and Pakistan. In total, 96 ships were dismantled worldwide from July until September 2024.
Developments in Bangladesh
Human Rights Watch and the NGO Shipbreaking Platform condemn the explosion on the oil tanker SAWRAJYA which occurred on 7 September 2024, at S.N. Corporation Unit-2. In response to the accident, the Department of Environment and the Ministry of Industries (MoI) suspended S.N. Corporation’s Environmental Clearance Certificate and established an eight-member committee to investigate the incident, which has identified both technical and management failures as causes of the explosion.
The explosion took place just months after Nippon Kaiji Kyokai certified the yard against the International Maritime Organization’s HKC, which is set to take effect on 26 June 2025. According to the report, this tragic incident highlights the ongoing failures of both international and national regulations, inadequate oversight, and weak labor rights protections in the shipbreaking industry.
Crisis in the shipbreaking industry in Chattogram
The shipbreaking industry is facing unprecedented challenges, marked by its lowest import volume of end-of-life ships in a decade as of 2023. While there was a slight rise in the first half of 2024, the industry’s outlook remains uncertain. Key factors contributing to this crisis include the high cost of the dollar, discrepancies between international and local markets, and a reduced number of ships available for scrapping due to rising shipping freight costs. Further complicating matters are stringent central bank regulations requiring approval for opening Letters of Credit exceeding $3 million.
Geopolitical tensions, such as the ongoing Russia-Ukraine war, the Israel-Palestine conflict, and the Houthi attack on a merchant ship in the Red Sea, have further exacerbated the industry’s challenges. These factors have made shipbreakers in Chattogram increasingly cautious about importing end-of-life vessels. Consequently, over 50 shipyards have shut down in recent years, with another 20 ceasing operations in the past 18 months. The remaining yards face significant uncertainties, and industry stakeholders fear the sector may not survive without government intervention. The recent developments in Bangladeshi politics and the tragic incident of 7 September at a yard with a Statement of Compliance with the HKC open an unprecedented opportunity for the industry to move off the beach.
Developments in India
Over 80% of the shipbreaking plots in Alang are currently in decline, and the predominantly migrant workforce has significantly diminished. Industry insiders report that the workforce, primarily composed of migrants, has dropped from 40,000-60,000 to just 3,500. During the 2024 Vibrant Gujarat summit, Alang was promised over ₹1,600 crore (around €174,468.85) in investments, mainly from shipbreaking companies. However, these commitments have largely remained unfulfilled. The proposed plan aims to double Alang’s ship recycling capacity from 4.5 million LDT to 9 million LDT and create an additional 50 plots.
