With dim hope for insurance claim, BSC now wants to recover ‘abandoned’ Banglar Samriddhi

The Bangladesh Shipping Corporation (BSC) has to mull options to retrieve its Banglar Samriddhi ship, which has been abandoned in Ukraine after a rocket attack, as its Singapore-based consultancy firm AqualisBraemar LOC (ABL) has reported that the BSC is not eligible for getting its full insurance claim for the damaged ship.

The state-owned oceangoing ships management authorities disclosed its plan at a meeting of the parliamentary standing committee on shipping ministry on Thursday, Shamil Uddin Ahmed Shimul, legislator from Chapainawabganj-1 constituency and a member of the standing committee, told The Business Standard.

The meeting discussed the latest situation of the damaged ship, Shimul said, adding the BSC presented a report on the ship on the occasion.

The BSC report said, "According to the rules, the cost of salvage and repair has to be more than 80% of the sum insured to make the constructive total loss (CTL) effective for abandoned a ship. In the case of Banglar Samriddhi, the cost of salvage and repair would have to be more than $17.98 million to make the CTL effective. If the amount is less than that, it will be considered as partial loss."

The BSC has made an insurance claim of around $22.8 million from the Sadharan Bima Corporation for the Banglar Samriddhi ship.

The shipping corporation hired the ABL to determine the salvage and repair costs of Banglar Samriddhi, mentioned the report, adding, "Since it was not possible to appear directly on the ship because of the war, the ABL reviewed various information of the ship, pictures of damage, video footage, etc and determined the estimated repair cost by remote assessment. The ABL report estimates the total cost of rescuing and repairing the ship at $3.3 million. As such, the BSC is taking up initiatives to start ship rescue and repair activities as it is unlikely that the CTL will be effective."

In this situation, Shimul said, the parliamentary standing committee had suggested taking measures to bring back the ship to the country. They asked for laying emphasis on diplomatic efforts to this end, and also stressed getting compensation from the insurance company.

Sakhawat Hossain, general secretary of the Bangladesh Merchant Marine Officers Association, said, "We have been saying from the beginning that the BSC is showing great incompetence in every step it has been taking with regard to the Banglar Samriddhi ship. You will declare a ship abandoned that has got damaged during a war between foreign countries, will make full insurance claim for it, and the insurer will pay you the money – how is that possible?"

"The main problem with the BSC is that they do not share any issues with us, even though we have many international standard mariners in our organisation who could give good advice to BSC in this regard."

TBS contacted two top officials of the BSC but they did not agree to comment on the matter.

BSC wants to recover the ship

The Banglar Samriddhi ship has been in an abandoned state for three months, but the BSC did hire even a watchman to watch over the ship in this long time. The report of the consultancy firm ABL, however, has talked sense to the BSC.

In its report submitted to the parliamentary committee, The BSC states that since the ship has been stranded in the Ukrainian port of Olvia for a long time, the amount of indirect loss to the BSC, including the payment of its insurance/ war risk premium, is increasing day by day.

The BSC has also requested ministry concerned to ask for co-operation from the Bangladesh embassies in Poland and Romania to expedite the rescue and repair of the damaged ship.

Maritime lawyer Hamdur Rahman told TBS that the BSC did not specify under which criteria the ship was abandoned. And, since the ship has been staying in the port area for three months, the Olvia port authorities are more likely to claim ownership of the ship to recover their dues. They will demand a minimum fine of $10,000 for each day."

Shimul MP said the standing committee suggested appointing an apt consultant to determine whether abandoning the ship or rescuing it will be beneficial for the country.

The committee also recommended that the ministry immediately appoint a maritime lawyer to the committee formed to investigating the shipwreck.

Can the abandoned ship be brought back?

Captain Enam Chowdhury, president of the Bangladesh Merchant Marine Officers Association, told TBS, "The ship's navigation system was completely destroyed in the attack. Its main power generator is also not working. Therefore, the ship is not fit to go out on a voyage. In particular, Turkey will not allow the ship to be taken out through the Bosphorus."

"As an alternative, the ship can be repaired at a dockyard in a neighboring country once the war ends. It may cost more or less Tk300 crore. Local firm Prantik Marine put forth a proposal to the BSC in this regard, but the BSC did not respond," said Captain Enam Chowdhury.

Banglar Samriddhi with 29 crew members got stranded at the port of Olvia in Ukraine on 23 February during the Russia-Ukraine war. It was hit by a rocket on 2 March. The merchant ship was chartered under an agreement with the Danish Charter Delta Corporation. The front of the ship got damaged in the missile attack and its third engineer Hadisur Rahman was killed. However, the 28 other sailors were evacuated.