Environment and Forest Minister Tariqul Islam yesterday told reporters they have issued a ban on the ship's entering Bangladesh territory.

"Based on the available information, we've decided to ban the ship from entering our waters," the minister told the reporters emerging out of a closed-door meeting at his ministry auditorium.

Asked about the ship's taking a new name -- Blue Lady -- he said it would not be allowed to enter Bangladesh territory even if it changed name.

The central bank and the customs authorities would be instructed not to issue an import order for the ship, he added.

The ministry as a precaution measure will also direct the coastguards not to let the ship move to Bangladesh. On the other hand, officials of the ministry are working to collect more information about the ship.

The government decision came after a Bangladeshi scrap merchant, Lokman Hossain, said he had bought the 11-storey SS Norway at over $12 million and is waiting to make the payment.

"Everything is settled, but I could not pay the amount due to the dollar crisis in the local market," said Lokman.

The SS Norway, launched in 1960 as the SS France, has been docked in open waters off the Malaysian port Penang for months awaiting a buyer as no-one was willing to buy it due to a warning of Greenpeace.

Earlier, reports were published that global environmentalist group Greenpeace has included the SS Norway on a watchlist of 50 vessels, which it fears, will not be decontaminated before being scrapped.

It says the French workers who built the ship claim it contains 1,250 tonnes of materials that contain asbestos, which poses danger to human health and environment.

Following newspaper reports, dozens of environmentalists formed a human chain in Chittagong to protest against the move to dismantle the ship at Hossain's Giri Subedar Ship Breaking Yard.

The Bangladesh Environment Lawyers Association has served legal notices on relevant government agencies in a bid to halt the ship being brought into Bangladeshi waters.

Ship-breaking yards in Bangladesh dismantle more than 80 ships, mostly oil tankers, every year. Operating on beaches at Sitakundu, they indirectly employ some 300,000 people.

Meanwhile, quoting different Indian newspapers yesterday, AFP reports that French President Jacques Chirac's move to order home an asbestos-lined warship from the Indian Ocean would lift a cloud hanging over his weekend state visit.

"Chirac orders toxic ship back, French president clears the air ahead of his India visit," reads the headline splashed on the front page of the country's leading daily, the Times of India.

The Hindu newspaper said in its report: "The announcement has saved both Paris and New Delhi a degree of embarrassment since Mr. Chirac is to begin a 24-hour state visit to India on Sunday [February 19]."

Chirac's decision on February 15 marked a big win for environmentalists in both countries, who argued that sending the decommissioned warship Clemenceau to India for scrapping posed a serious environmental and health hazard.

The president's announcement came after France's highest administrative court ordered the ship's transfer to be called off in response to legal action by Greenpeace and three anti-asbestos groups.

The boat, which was to be dismantled at the world's biggest ship-breaking yard Alang in the western state of Gujarat, now is moored outside of India's territorial waters.

Most sea-going ships end their service at shipyards in India, Bangladesh, China and Pakistan, where activists say they are cut up by unprotected workers, taking a grim toll on human health and environment.