The Bangladesh government is implementing a plan to strengthen the country's shipbuilding industry in order to increase exports and improve design capabilities and infrastructure. This plan is being carried out to create favorable conditions for tapping into the markets of Europe and North America.
Financial Facilities and Challenges
While a reconstruction fund worth 20 billion taka has been established for this industry, shipbuilding owners believe that the stringent conditions for eligibility hinder access to these facilities. The Central Bank of Bangladesh issued guidelines on February 8 to expand this plan, aimed at promoting the development and growth of the coastal shipbuilding industry.
According to these guidelines, participating banks were allowed to apply for reconstruction until June 30, 2024, but given the potential of this industry to increase export revenue, the application deadline has been extended to December 31, 2026. Entrepreneurs have requested the ministry to review the conditions of these guidelines and facilitate financial facilities.
Competitive Challenges and Need for Political Support
Entrepreneurs also stated that the lack of bank guarantees and high borrowing costs have hindered securing large export orders for local shipyards. Some contracts have been awarded to competitors from countries like India and Vietnam. Engineer Abdul Rashid, CEO of Karnaphuli Dry Dock, mentioned in an interview that building a ship can take up to two and a half years, which makes high borrowing costs a significant challenge for local shipbuilders.
He also emphasized the need for access to affordable financing and adequate guarantees to compete with international orders. At the same time, he pointed out the existing inequalities in financial and economic policies and called for easing conditions for local shipbuilders.
The Minister of Commerce, Khondaker Abdul Muktadir, announced at an event in Chittagong that the government prioritizes support for policies and infrastructure of the shipbuilding industry. He also mentioned plans to establish a design center and develop modern skills in collaboration with countries like Norway and the Netherlands.
In the fiscal year 2025-2026, Bangladesh exported ships, boats, and floating structures worth $22.53 million.
