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Exploring Bangladesh’s trade access, shipping reliability and economic future.
This site aims to provide accessible, factual, and balanced information about the Bangladesh Flag Vessel Act and its potential impact on trade, logistics, and exports.
It does not represent the views of any government or private entity.
Open Seas:
Fair Shipping Access for Bangladesh
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Industry calls for full repeal or major amendment of the Act
2025
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Bangladesh's High Court eases restrictions on foreign vessels transporting Bangladeshi goods [5] [15]
2024
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Flag Vessel Rule 2023 issued
2023
Key Developments
In 2019, Bangladesh introduced amendments to its maritime shipping policies restricting foreign-flagged vessels from carrying cargo unless Bangladesh-flagged vessels are unavailable.
In which case, foreign-flagged vessels may apply for a waiver allowance, which is a mandatory government-issued certificate that foreign-flagged vessels must obtain from the Mercantile Marine Department before loading or unloading cargo at Bangladeshi ports. Waivers are granted when the required capacity on Bangladeshi-flagged ships is unavailable.
There is some concern that the policy in its current form may impact trade operations and shipping costs[2], and investment confidence[3]. And may have an impact across Bangladesh’s export infrastructure and may raise concerns among shipping lines, exporters, and trade partners.[3][32]
Background to the Bangladesh Flag Vessel Act 2019[1]
Potential impact
Bangladesh’s current shipping legislation was introduced to support domestic maritime capacity. However, it has been reported unexpected side effect of its implementation could lead to operational, economic issues across the shipping and export sectors. Below we explore these challenges through three key lenses.[2][3][25]
Potential for operational disruptions and increased costs
Economic and Trade Impact
It has been reported that the current legislation may affect Bangladesh’s competitiveness and increase shipping delays, which can potentially reduce foreign exchange earnings.[25]
Concerns over compliance with international trade and maritime rules, could impact Bangladesh’s business environment.[14] Also comments have been made regarding potential alignment aspects between the legislation and international treaty obligations.[7]
Driving future growth in Bangladesh
Balanced reforms , and public-private partnerships [21] - can support national goals while maintaining trade competitiveness. Modernising the shipping sector and aligning with international standards may attract investment and create jobs.
Collaboration between local and foreign operators can help strengthen Bangladesh’s global trade position and support key exports. Future growth depends on balancing national interests with global integration and ensuring shipping policies align with port infrastructure.[22]
Read
It has been reported that the legislation in its current form may increase operational complexity, delays, and costs, reducing competitiveness for shipping lines and exporters.[2][6] With only 8 Bangladesh-flagged container ships in 2023 [7] available, restrictions on foreign vessels have led to capacity shortages and potentially higher freight rates. Domestic flagged container capacity is planned to be increased by Bangladesh Shipping Corporation with six new vessels by 2028 but this will still leave a significant shortfall in container shipping transport demand.[8] If there are any potential bottlenecks potential higher costs and complex waiver conditions, this may cause some further strain exporters, especially in key sectors like garments.[25]
Potential for operational disruptions and increased costs
Read
It has been reported that the current legislation may affect Bangladesh’s competitiveness and increase shipping delays, which can potentially reduce foreign exchange earnings.[25]
Concerns over compliance with international trade and maritime rules, could impact Bangladesh’s business environment.[14] Also comments have been made regarding potential alignment aspects between the legislation and international treaty obligations.[7]
Economic and Trade Impact
Read
Balanced reforms , and public-private partnerships [21] - can support national goals while maintaining trade competitiveness. Modernising the shipping sector and aligning with international standards may attract investment and create jobs.
Collaboration between local and foreign operators can help strengthen Bangladesh’s global trade position and support key exports. Future growth depends on balancing national interests with global integration and ensuring shipping policies align with port infrastructure.[22]
Driving future growth in Bangladesh
Bangladesh-flagged vessels make up less than 8-10% of total shipping volume
Limited national fleet
Average shipment delays per port
It has been reported there are some possible concerns t he restrictions on foreign vessels coupled with the current insufficient Bangladesh-flagged container vessel capacity mean shipments could face delays, higher costs, and greater administrative burdens. However, it has been reported the Flag Protection Act should be utilised when cargo volumes fall and to help protect domestic carriers.[9][10][11]
Port congestion. Possible Increased freight costs. Scheduling concerns.
It has been reported that the legislation in its current form may increase operational complexity, delays, and costs, reducing competitiveness for shipping lines and exporters. [2][6] With only 8 Bangladesh-flagged container ships in 2023 [7] available, restrictions on foreign vessels have led to capacity shortages and potentially higher freight rates. Domestic flagged container capacity is planned to be increased by Bangladesh Shipping Corporation with six new vessels by 2028 but this will still leave a significant shortfall in container shipping transport demand.[8] If there are any potential bottlenecks potential higher costs and complex waiver conditions , this may cause some further strain exporters, especially in key sectors like garments.[25]
Potential for operational disruptions and increased costs
- Annual exports (2024)
Export industries impacted
International Chamber of Shipping (ICS), Letter to the Government of Bangladesh, February 2023[15].
It is our firm belief that constructive dialogue and cooperation between maritime authorities and the global shipping industry can lead to solutions that promote sustainable growth, mutual benefits, and the overall well-being of the international maritime community.
Bangladesh’s export strength relies on seamless global shipping access. Current restrictions may impact competitiveness, strain exporters, and deter foreign direct investment due to uncertain logistics and legal ambiguity over trade fairness.[11]
Trade competitiveness at risk. Investment hesitation.
It has been reported that the current legislation may affect Bangladesh’s competitiveness and increase shipping delays, which can potentially reduce foreign exchange earnings. [25]
Concerns over compliance with international trade and maritime rules, could impact Bangladesh’s business environment. [14] Also comments have been made regarding potential alignment aspects between the legislation and international treaty obligations.[7]
Additionally, Bangladesh ratified the United Nations Convention on the Law of the Sea (UNCLOS) on July 27, 2001, establishing maritime obligations. While Bangladesh benefits from special and differential treatment as a developing country, some observers suggest the current legislation may warrant review to ensure continued alignment with these international commitments.[15]Â
It has been reported Bangladesh's shipping and logistics sector is at a crossroads, facing challenges and opportunities amid rapid industrial growth and global trade integration. Experts at a recent Financial Express roundtable called for some reforms claiming it can help achieve a $100 billion export target but also for Bangladesh’s broader economic competitiveness and growth ambitions.challenges and opportunities amid rapid industrial growth and global trade integration.[16]
Economic and trade impact
Future benefits
Fairer trade environment, aligned with global standards
Job creation in ports, logistics, and maritime industries
Increased Foreign Direct Investment and trade volume
Investment in Bangladesh’s shipping capacity
Key potential benefits of legislation reforms:
There is a clear path forward—one that safeguards national interests while enabling competitiveness and growth. Balanced reforms to the current legislation could encourage investment, increase domestic fleet strength, and help promote global market growth.
Reforms can unlock growth, not restrict it.
Balanced reforms , and public-private partnerships [21] - can support national goals while maintaining trade competitiveness. Modernising the shipping sector and aligning with international standards may attract investment and create jobs.
Collaboration between local and foreign operators can help strengthen Bangladesh’s global trade position and support key exports. Future growth depends on balancing national interests with global integration and ensuring shipping policies align with port infrastructure.[22]
Driving future growth in Bangladesh
Refinement doesn’t mean repeal—it means keeping goods moving while building Bangladesh’s shipping future.
Refining Bangladesh’s maritime legislation offers a shared opportunity to align national goals with global trade dynamics. Constructive changes can strengthen the local fleet, protect exports, and drive involvement with international partners.
Navigating the path forward
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Bangladesh Vision 2041 is an ambitious national development strategy launched by the Government of Bangladesh to transform the country into a high-income, developed nation by 2041.
Bangladesh’s Vision 2041
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How Bangladesh’s flag vessel shipping law is disrupting the garments industry.
How Bangladesh’s Flag Vessel Act 2019 can impact the garments industry
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Maintaining trade competitiveness in light of Bangladesh Flag Vessel legislation.
Maintaining trade competitiveness in light of Bangladesh’s Flag Vessel Act 2019
Insights