Stimulating investment in blue economy

The size of the investment that the formal lending institutions, that is, banks, have already made or are willing to make in a particular sector of the economy is indicative of the particular sector's importance in the economy. From that perspective, the blue economy does not seem to play a substantial role in Bangladesh's economy. According to a report carried by the Monday's, November 12, issue of this paper, the flow of bank credit to exploit the vast marine as well as maritime potential of the country has been both inadequate and inconsistent over the past years. Going by the central bank data, the total outstanding loan in the blue economy projects under green financing till June 2025 stood at Tk 8.48 billion. But looking back on December 24's figure of outstanding loans at Tk13.50 billion, there is reason to be flabbergasted at the behaviour of lean credit flow in the blue economy sector. Whatever are the particular factors at play behind the fall in credit flow during the first six months of the current calendar year, it clearly reflects the reality of the sector despite the rosy picture experts often portray about it at various discussion forums.

Given the fact that Bangladesh has a 710-kilometre coastline and extensive 'exclusive economic zone (EEZ)' that extends to 200 nautical miles equivalent to 118,813 square kilometres of maritime territory in the Bay of Bengal, it defies reason why both public and private investments have not poured into Bangladesh's blue economy on a massive scale as yet. Consider the marine resources including fisheries and aquaculture, shipping and maritime trade, tourism, offshore renewable energy and so on that could draw investments to create infrastructures, employments, improve livelihoods and boost trade. Especially, fishery resource of the sea needs to be exploited sustainably by way of preserving the marine ecosystem, which requires use of technology and scientific management of the fisheries and other aquatic resources. Moreover, just catching fish should not be the be-all and end-all of the fishery culture, for it is time, this sector is able to add value to its products for marketing at home and abroad. In addition to fishing, it should also involve farming of crustaceans, mollusks and aquatic plants.

Apart from aquatic life, other resources including the winds, tidal waves and abundant sunshine in the coastal areas can be harvested to provide power to coastal communities as well as the national grid. Since 90 per cent of the country's maritime trade is done through the Chittagong seaport, there is ample scope also for expanding the shipping trade through optimum utlilsation of Matarbari deep sea port once it is fully operational for commercial use. Also, the potential of ship building industry that has already built hundreds of small and medium-sized vessels for domestic as well as international markets should be exploited. But required investments to stimulate the different subsectors of the blue economy are missing? No project proposal involving blue economy has been submitted under the Bangladesh Bank's refinance scheme so far.

There is also talk of 'blue bonds', to draw private investment in the blue economy, as it is still in the conceptual stage. Experts are of the view that limited understanding of the financial industry about the blue economy is to a certain degree to blame for this poor investment picture. Banks have few tools to assess investment risks in its various sub-sectors as noted in the foregoing. In that case, the government is required to come up with a dedicated policy framework with provisions for fiscal incentives and capacity development for the sector. Meanwhile, the central bank in collaboration with relevant industries should develop a roadmap to encourage financing for blue economy.