Final answer:
The ship breaking industry in South Asia thrives due to the availability of skilled labor, advantageous geographic and tidal conditions, and the high demand for raw materials. Contrary to expectation, environmental regulations are not the main driving factor for businesses as they focus on cost-effectiveness across various other aspects of operation.
Step-by-step explanation:
The ship breaking industry is a significant sector in South Asia due to various factors, including the availability of skilled labor, the geographic location and tidal conditions, and the high demand for raw materials. The availability of land and labor has historically been a driving force in the regional development of industries, as illustrated by New England's shipbuilding industry during the colonial era. In South Asia, the availability of skilled labor at a lower cost is attractive to the industry. In contrast, geographic location offers natural advantages like deep waterways and tides that facilitate the dismantling of ships. The demand for raw materials derived from scrapped ships is also high. Interestingly, weaker environmental regulations may not be a decisive factor, as companies consider a range of other factors when choosing locations for industrial plants, such as the quality of transportation, proximity to supply chains and markets, financial capital, tax levels, and government competence. Costs related to environmental compliance tend to be a minor part of overall expenses.