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Published : 13 Jul 2026, 11:59 AM
Shipbuilding's Rocky Comeback
Boom to bust: A stunning $40.44 million debut in 2008 gave way to an 88 percent crash, then a further 1,202 percent plunge within four years
Pandemic wipeout: Earnings hit zero in FY2020-21 and FY2021-22, briefly recovered, then collapsed again in FY24 under the Russia-Ukraine war's shock
Fragile revival: Exports have surged 666 percent this year, yet entrepreneurs have yet to draw a single taka from the Tk 20 billion fund meant to support them
Bangladesh's ship exports first turned heads 16 years ago, earning a surprising $40.44 million in foreign currency in their debut year.
Entrepreneurs, expecting the momentum to continue, invested heavily, and a 16 percent rise in earnings the following year only fuelled their confidence.
But the eurozone's economic downturn knocked the sector off course in its third year, with earnings falling 88 percent.
A further 1,202 percent decline in the fourth year left the sector adrift in a sea of disappointment.
The tide turned the following year.
Earnings climbed for three straight years, reaching $65.61 million in 2016-17, the highest ship export earnings in Bangladesh's history.
The decline resumed the following year, before the COVID-19 pandemic upended the sector entirely.
Bangladesh earned no foreign currency from ship exports at all in FY2021 and FY2022.
A token amount returned in FY23, only for earnings to fall back to zero in FY24 amid the shock of the Russia-Ukraine war.
Over the past two years, though, the shipbuilding sector has begun rebuilding hope.
Exporters have launched fresh initiatives and are recalculating their prospects, hoping they will not need to look back again.
This is how the sector's fortunes have swung between hope and despair.
The latest Export Promotion Bureau (EPB) data show Bangladesh exported $22.53 million worth of ships in the fiscal year that ended on Jun 30, up 666.33 percent from the previous year's $2.94 million.
Dhaka's Ananda Shipyard and Slipways became the country's first ship exporter, sending a cargo vessel to Denmark on Sept 14, 2008.
Chattogram's Western Marine Shipyard followed in 2010, exporting a sea-going vessel to Germany on Nov 30 that year.
These remain the only two companies exporting ships from Bangladesh.
Coastal nations worldwide have increasingly focused on ocean-based economic activity in recent years, spanning fisheries and mineral extraction, marine renewable energy, maritime tourism, and maritime security and research.
These activities require specialised, high-tech vessels of different sizes.
Unlike the cargo ship market, the specialised high-tech vessel market doesn't see the same volatility, which is what drew Bangladesh's shipbuilders towards this promising export segment.
The government has also taken steps to boost exports in this sector, offering cash incentives, a special fund and tax breaks to exporters, while banks have extended substantial financing to the industry.
In early 2021, the then government introduced a policy projecting annual ship export earnings of $4 billion.
The promise shipbuilders showed a decade and a half ago proved short-lived.
From 2011, the global shipbuilding downturn began hitting Bangladesh directly, with foreign buyers cancelling numerous export orders.
The pandemic and the Russia-Ukraine war dealt further heavy blows to domestic entrepreneurs, with loan repayments from the two ship-exporting companies falling into irregularity.
Still, they are now trying to get back on their feet, leaning on the government's special policy support.
Western Marine Shipyard Managing Director Sohail Hasan told bdnews24.com, "For about two and a half years in between, we couldn't export a single ship.
“It wasn't just us, nobody exported any ships. Our industry really hit rock bottom. We never imagined we'd face such a precarious situation.
"Banks got caught up in our troubles too. Altogether, banks had injected Tk 50 billion in capital into the shipbuilding industry. With interest, that figure has grown considerably since.
“Many of us couldn't repay loan instalments on time. Several defaulted. We couldn't keep factories and offices running properly. Many people connected to this industry lost their jobs."
Hasan said the company has exported six medium-sized ships over the past year and a half, to Abu Dhabi, Dubai and Ajman.
Five more, all large vessels, are being prepared for export. "Two will be exported this year. Two more next year, and the remaining one the year after.
"The largest ship will go to Norway, in Europe. Of the remaining four, two will go to Abu Dhabi and two to Dubai. We've also received orders for two more large vessels."
Building a ship takes around 18 months, Hasan said. "Orders are coming in now. Besides Abu Dhabi and Dubai, many buyers from Europe are getting in touch. We're taking on orders according to our capacity."
The managing director said he was confident about the sector's revival. "We've turned things around now, and turned around well.
“Barring a disaster on the scale of the pandemic, we shouldn't need to look back again."
He added that financial strain had forced a shift in how ships get built. "Because of the financial crunch, buyers are now covering all our costs upfront. We're building and exporting ships with their money.
“But the crisis has largely eased now. We've started pushing to access the Tk 20 billion fund Bangladesh Bank set up for the shipbuilding sector, and we're hopeful of securing it soon.
"If we get a loan from that fund, we'll be able to build and export ships using our own financing."
Ananda Shipyard last exported a large vessel to UK-based Ingian Shipping Company Limited in September 2022, before going three years without another export.
In September 2025, it resumed exports by handing over a 5,500 deadweight tonne modern multipurpose vessel to Turkey’s Nopac Shipping and Trading Limited.
The order had been placed several years earlier.
The company has not exported another ship since then, but Chairman Abdullahel Bari said it plans to restart export activities with renewed efforts.
He told bdnews24.com that the vessel delivered to Turkey was the company’s largest and most technologically advanced ship so far. He said the order was placed before the COVID-19 pandemic and took several years of difficult work to complete.
According to him, Sonargaon has a long shipbuilding tradition, and Ananda Shipyard has carried that legacy forward.
He added that the once-neglected manufacturing sector is now moving ahead after overcoming several challenges.
Bari said the global market situation is now “favourable”, with many buyers making contact and seeking to place orders.
The company, however, cannot take new orders due to financial difficulties caused by years without exports.
He said access to long-term, low-cost financing remains a major challenge.
Under international practice, around 85 percent of a ship’s financing comes through bank guarantees, while the remaining 15 percent, worth around Tk 250-300 million, must be arranged from the company’s own funds.
Banks often hesitate to provide this portion, leaving working capital tied up during production and causing delays, he said.
Ananda Shipyard chief said proper government support could help build a strong and competitive shipbuilding industry that would contribute further to the country’s development.
He said he met the then Bangladesh Bank governor in mid-January to discuss the sector’s condition and its future prospects.
He requested fresh instructions to banks so shipbuilders could access the Tk 20 billion fund created for the industry.
Bari said the former governor responded positively and expressed hope that ship exports would enter a new phase.
Tk 20bn Fund Remains Untouched
According to the Association of Export Oriented Ship Building Industries of Bangladesh (AEOSIB), while Western Marine and Ananda Shipyard remain the country's only ship exporters, 10 factories nationwide are capable of exporting ships.
Several of these factories have already shown their capability by building specialised vessels for domestic use, maintaining international standards even though the ships were built for the local market.
Karnafuli Ship Builders Limited is separately building dredgers across three factories in Narayanganj and Chattogram.
Beyond the private sector, three Navy-run yards have also demonstrated capability in building specialised vessels, including warships, for the Navy's own use.
Bangladesh Bank set up a Tk 20 billion refinancing fund in May 2022 to develop the shipbuilding industry, under the Shipbuilding Industry Development Policy 2021.
The policy set a maximum lending rate of 4.5 percent under the fund, with banks able to access refinancing from the central bank at 1 percent.
Yet shipbuilding entrepreneurs have not drawn a single taka from the fund to date.
Asked about this, Hasan said: "These past few years have been really tough for us. What would we even do with a loan? We had no orders.
“Things are improving now, so we will take loans. We're already in touch with banks."
Experts Urge Small Ship Focus
Economist Zaidi Sattar believes there is little to gain from chasing large ship exports, since that global market is dominated by China, South Korea and Japan.
Bangladesh, he said, holds far greater potential in the small and medium ship market, spanning multipurpose vessels of up to 12,000 DWT, feeder vessels and ferries, a global market worth around $115 billion.
"If Bangladesh can capture even 1 percent of the small and medium ship market by 2027, this sector alone could earn $1 billion a year," he said.
The chairman of the Policy Research Institute (PRI) said 80 percent of global trade moves by sea, meaning shipbuilding demand tracks the health of international trade.
As global trade grows, so does demand for new ships. Shipbuilding, he said, is a labour-intensive, promising industry for Bangladesh, and diversifying production could help the country compete in the small and medium ship market.
Demand in this sector rises and falls in roughly 10-year cycles, Sattar said, and Bangladesh currently sits in an upward cycle.
He urged the government and private sector to work together to seize the opportunity.
