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Allowing Indian ships for transshipment without increasing capacity to create barriers for domestic exporters

While Bangladeshi exporters and importers are accustomed to facing unusual delays in releasing goods, Indian ships are getting priority at Chittagong Port to unload goods. It is about the much-talked transshipment between Bangladesh and India, which started its trial run and the first ship reached Chattogram Port on 21 July.

On July 15, the first trial container ship from Kolkata to Agartala through Chattogram Port of Bangladesh was inaugurated.

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In line with the agreement between Bangladesh and India on the use of Chattogram and Mongla Ports for movement of India’s transit cargo through Bangladesh, MV Shejyoti arrived in Chattogram Port with 108 containers of goods on July 21.

Of the 108 containers, four carrying iron and pulse will be transported to Tripura and Assam of India through Akhaura-Agartala land port.

This transshipment is aimed at increasing connectivity with the part of the north-eastern state of India, which brings benefits to the Indian government as well as the business people.

However, the trial run has increased the concerns of Bangladeshi business people as it may impact on smoother operations of export imports of the country.

“It is totally against the interest of the country’s business as the Indian ships will get priority in terms of goods loading and unloading. Where we are suffering severely to get our imported products delivered and shipping goods for exports, seeking anonymity exporters of Chittagong told Textile Today.

It will increase our lead time further, which is a bad sign for the exporters as the global buyers want quicker delivery of their goods, said the businessman.

So, the government should not give priority to Indian ships and if the government wants to allow them, it can build dedicated berthing or jetty for the Indian ship loading and unloading, urged the exporter.

As per the agreement between Bangladesh and India, Indian ships will get priority in terms of goods loading and unloading.

 

However, the government officials dealing with the issues explained it differently.

“Giving Priority to Indian ships does not mean that they will get service first keeping the Bangladeshi ships aside. We will consider our interest first and they will get priority in case of availability of jetty,” said Chittagong Port Authority (CPA) Secretary Md. Omar Faruk.

He also said it would not hamper local business as the government is increasing logistics and efficiency of the port management.

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What experts say

Ease of doing business ranking is a crucial issue for Bangladesh in attracting foreign investment and reducing lead time in exports, said Ahsan H Mansur, Executive Director of Policy Research Institute (PRI).

Without increasing capacity, allowing Indian ships for transshipment will be great barriers to improve the ranking of ease of doing business as it will increase the congestion in the port, said the economist.

For the longer lead time, inadequate infrastructure and efficiency of port management are largely blamed. So giving priorities on Indian ships loading and unloading will increase the congestion and add salt to the woes of the business community,” said Zahid Hussain, an economist.

First, the government should think about the country’s export and imports in keeping the economic activities vibrant through smoother operations at ports, said Zahid.

Since our main obstacle in reducing lead time is logistics weakness at the port, I think allowing Indian Ship with priority at Chattogram port will hinder the business of local exporters, he added.

Though the Indian businesspeople are terming the agreement as a part of strengthening the connectivity and long-standing partnership between India and Bangladesh it is not good for the local port users especially the exporters, said a business leader, who preferred not to be named.

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Figure: Ways to lessen the congestion at ports.

“We are already facing trouble in loading and uploading export-imports goods, which gives an advantage to our competitors in the global markets as they offer shorter lead time,” said BGMEA former Vice President Nasir Uddin Chowdhury.

In the given context, if the vessels get priority, it will adversely impact the country’s business, said Nasir. We should think about the growing demands of our export and import business, he added.

Meanwhile, Altaf Hossain Chowdhury, General Secretary of Chattogram Customs Clearing and Forwarding Agents Association said, “Though it will increase the income of the port it may hit the local business as after the pandemic the business of the port will increase when the economic activities will be fully operational.”

He urged the government to utilize the revenue earned from the transshipment for improving network and port capacity to avert congestion.

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