As a garment maker first and a senior Board member of the BGMEA having served the industry more than 25 years meaning of logistics in my world was at one point many years ago, finding a secure trucking company, taking the export consignment out of the factory, reaching the port, handing over the cargo on time and meeting my shipping deadline!
That was the first 30 years early to mid-nighties to the millennium, however today logistics and what we understand is a different and vast world which includes the speed of your Wi-Fi and how quickly u can book a container on line to handing over cargo which mostly digital excepting the traffic to take our trucks out of the industrial belts to Chittagong port.
|Containerized Throughput (In & Out) at Chittagong Port growth of 6 years|
Much has evolved and evolving every day as a nation and as citizens of the country we can see all the physical and infrastructure changes which are happening to take our country forward in to a middle-income country by 2030.
For which I would like to thank the honorable Prime Minister Sheikh Hasina for her far-reaching vision and creating the road map to the future of Bangladesh and getting the job done and positive progress over the past 15 years!
We as RMG makers dreamt of a 50-billion-dollar export only 10 years ago and today it’s a reality but without the right policy support and the infrastructure logistics in place or continued improvements we could not have achieved same.
However, with every positive comes new challenges and to rise above it we need continued support with the correct framework in place to reach BGMEA’s recent target of 100 billion USD!
I am happy that recently in the Industrial Policy — announced on September 25, 2022 by the Ministry of Industries — logistics has been included for the first time as one of the export diversifications sectors and it has also been considered a thrust sector. 21 logistics sub-sectors have been included in the policy. It is clearly evident that the government is willing to give more importance to logistics development in the coming years.
A number of studies have been conducted so far comparing Bangladesh’s logistics performance with other countries which show the country needs further preparation in terms of improving its logistics infrastructure to be a developing country by 2030 and a developed country by 2041.
In Bangladesh there are about ten ministries, twenty-four government agencies looking after the logistics sector. As in other countries, there is a need for a focal point ministry so that discipline can be brought in this sector and logistics cost can be reduced. Most important is to ensure smooth coordination so that with a single document whole logistics support services can be ensured.
It is seen from the statistics that global economy will be about $9 trillion bigger by 2030 by improving trade facilitation activities which can lower average trade costs by 14 percent.
In Bangladesh, permission from 33 licensing agencies are required for export, about 15 licenses are required for a formal business to start.
It is time to make ease of doing business a reality!
I would like to share some data I have collected where export-import cost is higher in Bangladesh ($633, $1270) than other countries such as– Vietnam ($429, $556), India ($270, $366). The country needs attention for improved trade facilitation and automated services for reducing cost of doing business.
Logistics infrastructure development has been treated as one of the key factors in ensuring industrialization in the today’s competitive and complex business age.
We need to achieve our targets of export diversification, employment generation, increased investment and FDI for further socio-economic development.
Our focus would need to be concentrated on advanced logistics infrastructure development and policy I repeat once again!
Even the difference in growth for 20 years from 1985 to 2005 was phenomenal:
- Cargo volume increased by 362%.
- Container volume increased by 3437%
- Number of Vessels increased by 183%
Yet today sitting in 2018 after 12 years from 2005, we find virtually no infrastructure development despite volume of cargo/container/vessels increasing with Double Digit Figures except Multi-Purpose Berth (MPB) with back-up yard & development of some container yard in General Cargo berth. The MPB was built with a vision to handle:
- 3 container vessels.
- Storage for 90,000 containers per annum.
- Storage capacity in General Cargo Berth was limited to 150,000 containers per annum.
All said and done Chittagong Port is overburdened with Container Trade Size.
Chittagong Port capacity: Why the congestion and why ships suffer berthing delay?
The problem lies in the terminal congestion. With ever growing trade volume Container Terminal continue to remain fully occupied. Due to congestion in the terminal, unloading/ loading of vessels suffer delay and consequently ships suffer berthing delay. The underlying facts leading to the terminal congestion can be traced at the below mentioned areas.
Import laden containers
The storage of import laden containers in the Port Terminal is the main cause of all problems and of overall congestion in the Port. If the Import laden containers can be removed out of Container Terminal to Off-Dock, then the congestion situation in the port will change over-night. If 95% of Export can be handled at Off-Dock it is not understood as to why 95% of the Import Laden Containers cannot be handled at Off-Dock. Further Chittagong Port is being used as a cheap and safe storage warehouse for storage of cargo and the containers. The cargo awaits in Port for months together. This should not be allowed to happen. Either the containers should be taken to Consignees premises or to Off-Dock within 24 hours of discharge from the feeder vessels.
Misuse or wrong use of Port’s Container Terminal Chittagong Port Container Terminal should not be allowed to be used for the purpose of stuffing/un-stuffing operation or for storage of Laden and/ or empty Containers other than being used as a Transit point for the Containers.
The import laden containers, upon discharge from feeder vessels, should be removed to Off-Dock within 24 hours of discharge. Similarly Export laden containers should be brought to the loading terminal 24 hours prior to the vessel’s berthing. This will avoid any congestion in the Terminal storage yard and the loading/ discharging productivity of the feeder vessels will certainly increase manifold. If this plan is implemented the congestion in the Terminal and congestion in the berthing of the Container Feeder Vessels will totally disappear.
Productivity of vessels currently berth occupancy of the vessels are up to 4/5 days. Discharging/loading productivity depends on the speed of discharge/loading. These are currently limited by factors beyond Port Authorities control as there is hardly any space available for storage of Import laden containers in the Terminal after discharge from the vessels.
Thus, if the import laden containers are removed to Off-Dock, huge amount of storage space will be available. This will help increase the discharging/loading productivity of Vessels. The berth occupancy period of the vessels will decline. Chittagong Port image will shine because efficiency of the Port is judged by the level of loading/unloading performance to & from vessel and not by the speed of delivery and clearance.
Gantry Cranes: Different kind of publicity is going on as to the problems of gantry cranes. Some say the gantry cranes are faulty and some say the Operators are inefficient and so on for which the performance by Gantry crane is below the expected level. Notwithstanding opinions the cognized problem is lack of space in the terminal yard. No one can expect the gantry crane and operators to perform when the back up space is simply not there.
Off-Dock: The growth of trade is a real pressure on Chittagong Port. To overcome the problem of ever-increasing pressure of trade, the import laden boxes have to be removed to Off-Dock. For some unknown reasons despite the limitation of space ‘X’ & ‘Y’ Sheds were leased out to Private Party these could easily have been used by Port Authority for Off-Dock linkage.
Some more recommendation to upgrade the efficiency of Chittagong Port to smoothen ease of doing business:
- The Port Authority should immediately make arrangements with the Customs Authority for removal of the import laden containers to Off-Dock.
- In this regard it is advisable that Chittagong Port Authority takes over the Steel Mill Area, convert same into an Off-Dock for Import laden containers.
- All Import laden can be removed there.
- In course of time, Fly-over can be built to connect Steel Mill Off-Dock area with the New Mooring Terminal.