Bangladesh has slipped from its long-held position as the world’s leading ship-breaking destination after imports of end-of-life vessels fell by more than 32 per cent in 2025, according to new data from the NGO Shipbreaking Platform.

The country imported 88 scrapped ships with a combined weight of 2.68 million tonnes in 2025, down from 130 vessels a year earlier.

The decline marked a sharp reversal from recent peaks, when Bangladesh dismantled 170 ships in 2023 and 122 in 2022. In 2021, the figure had reached 254 ships.

India overtook Bangladesh last year, importing 111 vessels weighing 3.36 million tonnes to become the top global destination for ship recycling.

The latest downturn continued a broader downward trend observed since 2020, when Bangladesh brought in 144 ships for dismantling.

Local operators trace the slowdown back to late 2019, citing the impact of the Covid-19 pandemic and subsequent shutdowns.

Although the sector experienced a rebound in 2021, largely driven by pent-up demand, industry representatives say it is now grappling with a dollar shortage and high interest rates, which have dampened trade.

Insiders also attribute the recent fall in both vessel numbers and tonnage to stricter compliance requirements under the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (HKC), adopted by the International Maritime Organization.

The convention entered into force in June 2025, mandating that only compliant yards may import and dismantle ships.

Industry leaders argue that compliance comes at a steep cost.

Amzad Hossain Chowdhury, president of the Bangladesh Ship Breakers and Recyclers Association (BSBRA), said yards must secure green certification under the HKC before importing scrapped vessels, a process requiring investment of between Tk 300 million and Tk 1.0 billion depending on yard size.

‘Banks are willing to provide loans for importing ships, but they are reluctant to invest in yard development because the sector has been categorised as ‘red’ by the environment ministry,’ he said, urging the government to reclassify the industry under a less restrictive category to facilitate financing.

Hossainul Arefin, a BSBRA executive committee member, said the shift in environmental classification has increased the number of required certifications and approvals.

Delays in obtaining these can stretch over several months, during which businesses accrue bank interest.

According to the association, 23 Bangladeshi yards are currently certified under the HKC framework, 17 fully compliant and six provisionally certified, while a further 20 are in the process of upgrading facilities using their own funds.

Globally, the NGO Shipbreaking Platform reported that 321 ocean-going commercial vessels were sold for scrapping in 2025.

Of these, 214 large tankers, bulk carriers, offshore platforms, cargo and passenger ships were dismantled on the beaches of Bangladesh, India and Pakistan, accounting for more than 85 per cent of the gross tonnage broken up worldwide.

Turkey imported 49 scrapped ships last year, followed by Pakistan with 15 and the European Union with 14, while 44 vessels were dismantled elsewhere.

Despite industry claims of improved safety standards, rights groups continue to voice concerns over working conditions and environmental damage associated with beaching practices, the method of dismantling ships directly on tidal mudflats.

‘Bangladesh and India remain the shipping industry’s first choices for scrapping, despite the documented grave consequences beaching ships has on workers, local communities and fragile coastal ecosystems,’ the platform said in a statement.

It reported that 11 workers lost their lives in South Asia in 2025 and at least 62 others were injured due to unsafe working practices.

One of the most serious incidents occurred at the Ziri Subedar yard in Chattogram, where an oil tank explosion injured eight workers during dismantling operations of the BANGLAR JYOTI, a government-owned vessel.

Although Bangladesh has approved 17 yards under the HKC, the platform said serious accidents continue to occur even at certified facilities, while incident reporting remains opaque or absent.

In India, no ship-breaking yards have yet been formally authorised under the HKC, but more than 100 plots in Alang-Sosiya hold private Statements of Compliance with the convention’s requirements.

Campaigners warn that relatively low global scrapping volumes in recent years — due to favourable operating rates in shipping — are masking a growing backlog of ageing vessels expected to head for dismantling in the coming years, including ships linked to so-called ‘dark fleet’ operations.

Nicola Mulinaris, senior communication and policy adviser at the NGO Shipbreaking Platform, said the anticipated surge underscores the need for safe, transparent and fully regulated recycling facilities away from beaching practices.

Existing facilities in the European Union that already meet higher environmental and safety standards continue to operate below capacity, he noted, suggesting that safer alternatives are available but remain underutilised.

Ingvild Jenssen, executive director and founder of the platform, argued that the Hong Kong Convention does not yet guarantee safe and environmentally sound practices.

She called for strengthening its requirements at the IMO, including measures to phase out beaching methods and ensure stricter enforcement of the Basel Convention’s restrictions on hazardous waste trade to hold the shipping industry accountable.