Bangladesh's vast ship-breaking yards are roaring back into business, after the easing of strict environmental regulations that brought the major industry to a halt for much of 2010.

A High Court ruling on March 7 reversed a series of 2010 court verdicts -- fought for by environmental activists -- that required vessels to be cleared of all hazardous material such as asbestos before being imported for scrap.

"Finally, we can see the end of our long legal problems," Hefazatur Rahman, president of the Bangladesh Ship Breakers' Association, told AFP, calling the ruling a victory for the industry.

The court decision has allowed the industry to restart the import of scrap vessels and 50 ships are now waiting to be broken at Sitakundu, the country's southeastern ship-breaking hub.

The ships are worth over $250 million and will yield 500,000 tonnes of iron plates, Rahman said.

"The country's construction industry is booming and we estimate ship breakers will import ships that will yield a record three million tonnes of steel plate this year," he said.

Steel from recycled ships supplies some 60 percent of Bangladesh's total steel needs.

The court, which also addressed fears over worker safety, has allowed yards to import ships while the government drafts a new set of environmental guidelines to regulate the key sector.

But environmental campaigners fear that no new regulation will ever come into force.

"We are scared the government doesn't want to regulate the industry," said Rezwana Hossain, head of Bangladesh Environmental Lawyers' Association.

"They are saying that legal obstacles will not be allowed to hamper the expansion of the industry."

Bangladesh's ship-breaking industry was the world's largest by tonnage in 2009 until the environmental groups' legal campaign shut down the sector, said Anam Chowdhury, a senior official at Bangladesh's ship-breakers association.

"We dismantled 200-plus ships weighing 2.2 million tonnes in 2009. But in 2010, the amount halved and we fell behind India, China and Pakistan. Thanks to the court ruling, we hope we'll reclaim our top position," he said.

The court did not entirely let the industry off, ordering scrapyards to improve worker safety, ensure ships are clear of toxic chemicals before they are scrapped and to hire on-site doctors to treat sick workers.

"They now understand that if they want to operate, they must keep a clean slate on environment and workers' safety. There are noticeable changes in the yards," said Jafar Alam, director of the government's environment department.

The government is also stepping up regulation, he said. Last month, an import permit was denied for the Probo Koala, a toxic ship that is alleged to have caused the deaths of 17 people in Ivory Coast in August 2006.

But Mohammad Ali Shaheen, the head of the local chapter of global NGO Platform on Shipbreaking, which opposes the recent High Court ruling, said that claims of safety improvements at the yards were "a whitewash".

"The main issue here is waste management. On this front, we hardly see any improvement. One new room to dispose of hazardous waste or a doctor doesn't change anything," he told AFP.

"The ship breakers must have dockyards to ensure full safety standards in scrapping. Unless that happens, the accidents and environment degradation will continue."

Since 2006, official statistics show that at least 82 workers have been killed and hundreds of others injured at scrapyards -- mostly due to gas explosions on oil tankers they were breaking.

Environmental groups say the figures are a massive underestimate as they only count on-site accidents and do not include labourers laid off after becoming sick from toxic chemicals.

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