Ship recycling industry refers to the process of dismantling and recycling End of Life (EOL) ships and it’s globally accepted. Basically ship recycling is a significant and green industry, with an average 1000 obsolete ships being recycled annually. At present global ship recycling industry is dominated by three South Asian countries, including India, Bangladesh, and Pakistan. In Bangladesh, the industry started with the dismantling of stranded ships and has since become a large and profitable industry. The industry creates huge employment opportunities for thousands of semi-skilled workers in poverty-prone areas of the country. Suchindustry has both opportunities and challenges for coastal zone management, as there are environmental, law enforcement and worker safety issues. Perfect green ship recycling as per European standard is always costly affair.  But, viable and almost green ship recycling with the integration of present usual practice (beaching method) in Asian countries is very much possible. Despite of the limitations and challenges the industry has considerable contribution to the GDP and the overall socio-economic sphere of Bangladesh. Presently, there have been visible reductions in Bangladesh's market share due to strict environmental regulations, while the competitors have experienced increases. It is an analytical study with considerable effort of research work to evaluate the present global ship recycling situation along with potential and challenges of local ship recycling industry.