Prospects and Challenges of Shipbuilding Industry as a Growing Sector of Bangladesh Economy

Abstract

Recently, Shipbuilding Industry has been treated as a potential growth driver of Bangladesh economy as per ‘Shipbuilding Industry Development Policy-2020’. Through this policy, the country hopes to earn $4.0 billion annually from ship exports by 2025. In this context, this study is an attempt by the researchers to investigate the potentials of this industry as a growing contributory sector of the economy. This research is an explanatory type of research based on secondary information. The study results indicate that the importance and contribution of shipbuilding industry have an important impact on the economy in meeting the targets of the Government of Bangladesh by becoming middle-income and developed economy within 2031 and 2041 respectively. Findings also revealed that Bangladesh shipbuilding industry has many comparative advantages including cheap labor, presence of ship-breaking industry providing the backward linkage for shipbuilding, natural gift of abundance of rivers throughout the country etc. Besides, the study addresses some problems as well as challenges of this industry that include: lack of an effective government policy, poor funding support by the banks and financial institutions, excessive cost of ship manufacturing compared to other shipbuilding nations, inadequate law & order situation, inadequate training for developing human resources etc. At the end, some recommendations have been made in the study in line with the study problems. It is expected that the findings of this study would provide some guidelines and valuable information to the stakeholders; specially the policy makers (public and private) and investors while making future policies regarding this industry.