This year’s budget has given relief to the entrepreneurs of sea-going vessels. The Government has agreed with some of the demands of the entrepreneurs to increase investment in this sector. For a long time, entrepreneurs in this sector could import ships which were at a maximum of 22-years-old from abroad. And after they made the purchase, there was no opportunity to sell the ship before 5 years. They had to pay in advance. Therefore, the entrepreneurs demanded to lift the various restrictions imposed on the business in this sector including reducing taxation.
In his budget speech, Finance Minister A.H.M Mustafa Kamal recommended that the lifespan of old ships be changed from 22 years to 25 years and the period of sale after imports be fixed at 3 years instead of 5 years. Sea-going vessels have also been included in the circular of withdrawal of advance tax. In the circular, the finance minister also announced the withdrawal of advance tax on the import of sea-going vessels with a carrying capacity of more than 5,000 tons.
According to the data of the Shipping Office last April, the number of sea-going ships carrying the flag of Bangladesh is now 66. KSRM (SR Shipping), Meghna Group, Akij Group, Bashundhara Group, Karnaphuli Limited, MJL Bangladesh, Orion Group and 11 other industrial groups have sea-going vessels. The number of ships has increased in the last few years as compared to the past due to increasing the facilities for the entrepreneurs in this sector. This year, industrial groups like Meghna Group and Karnaphuli Limited have made new investments in the sector.
According to the data of the three seaports, more than 10 and a half crore tons of imported and exported goods are transported by sea in Bangladesh every year. Very little of this product is transported on domestic flagships. According to Bangladesh Bank, in the fiscal year 2019-20, USD 2.87 billion or BDT 24 thousand and 359 crore has been spent on importing goods by sea. However, according to the Bangladesh Ocean Going Ship Owners Association, the cost of transporting goods by sea will not actually be less than USD 8 billion. From this, only USD 300 million, or 4.5% share held by Bangladeshi flagships.
