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29 October, 2018 00:00 00 AM
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Seaborne trade in Bangladesh: Future challenges

So there is no doubt that the growth of industry and service sector will continue to increase in the future
Md. Rezaul Karim
Seaborne trade in Bangladesh: Future challenges

Encouraging seaborne trade requires improvement of port facilities and other logistics support. In 2017-18 goods worth 51.53 billion US dollars were imported in the country while goods worth of 36.66 billion dollars were exported. The import and export trade has increased by 24.36% in last five years. In view of this, Bangladesh at this moment needs port centric infrastructure for transport of huge quantity of goods related to the foreign trade. Cargoes are now transported through three routes : two sea ports, 11 land ports and three airports. The total foreign trade goods amounted at 11.62 crore tonnes in 2017-18. It is found that around 82 percent of the cargoes are transported through sea ports and the rest are through land and airports.

Out of these three routes sea routes is the most important. We have three sea ports – Chattogram, Mongla and Payra. So far import goods have been delivered at the outer anchorage of Payra port. However, the main infrastructure of the port has not yet been developed. That is why; we at present have to depend on Mongla and Chattogram ports. But due to lack of navigability and for absence of good connectivity with Dhaka goods export from Mongla is not at the expected stage yet. Transport through this port would gain momentum after the Padma bridge is constructed. It is found that a total of 9.47 crore tonnes of goods were transported through these two ports in last fiscal (2017-18). Ninety percent of the total cargo which is around 8.50 crore tonnes were transported alone by Chattogram port while the rest 10 percent that means only 97 lakh tonnes were transported through Mongla.

Import goods like raw materials for the industries and export goods are mainly transported in containers. Containerized goods transport started in Bangladesh in 1977. Dependency on Chattogram port has increased since inception of the containerized goods transport. A total of 27 lakh TEUs containers were transported through this port in 2017-18, and this is 98.43 percent of the country’s total seaborne container transport. Only 42,989 TEUs, which is 1.56 percent of the total sea based transport of containers, were transported from Mongla.

There is lack of balanced distribution system regarding transport of containerised goods through seaports. This is leading to vessel congestion as well as container congestion at the port. Construction of new terminal is essential considering the ever increasing flow of goods transport. In last fiscal, berthing occupancy of the port jetties was 93%.So, it is necessary to build new jetties in Chattogram port.

In neighbouring India, the share of India’s major ports in transport of containerized goods is declining. Construction of new terminals has eased pressure on any particular port there. There are a total of 24 container terminals in India having capacity to handle 2.70 crore TEUs containers while 1.53 crore TEUs of containers were transported in 2017-18. Of the terminals, only APM Terminal, Mumbai and Adani Mundra Terminal handled containers beyond their capacity.

Following uncertainty over the Sonadia deep sea port project, government has now taken a number of big projects including construction of Payra Deep Sea Port in the Southern region, building a deep sea port at Matarbari in Moheshkhali and construction of a new port naming Bay Terminal at Potenga in Chattogram. All the three big projects are time consuming.

Many feel that Bay Terminal needs first priority considering the time and hinterland facilities. The proposed Bay Terminal has a very good connectivity through river, road and railways. Other two proposed ports lack such facilities. Since the site of Bay terminal is located outside Chattogram city, the port activities will not hamper the city.

Congestion has already started in Chattogram port. Chattogram Port Authority has started building a terminal having three jetties at Potenga to face the interim period. Two jetties are also being constructed at Mongla port.

But we need more new jetties even after launching of these two small projects. So, it needs to bring a change in container delivery procedure. The container delivery has to be shifted out of the port.

Hinterland connectivity system is most important for transport of foreign trade cargoes inside the country. Such connectivity has been developed centering Chattogram since major part of the country’s seaborne foreign trade goods are transported through Chattogram port. From much earlier, imported goods from Chattogram have been transported across the country by the coaster vessels through inland river routes. But for transporting the containerised import goods, river route has been launched very recently after the Pangaon Terminal was constructed. Container transport through the river route is gradually increasing since inception of Pangaon terminal on in 2013. After Pangaon, two more private river terminals have been launched.

Containerised goods are also transported through railways. But transport of containerised goods mostly depends on roadways. The major portion of the export goods are sent from Dhaka. Only 4 per cent of the total export load containers are transported from Dhaka to Chattogram port through railways. The reason behind dependency on the roadway is that the export goods at first need to be sent on covered vans from the factories to the private container depots.

Apart from the river terminal, most of the container depots are located in Chittagong. On the other hand, imported raw materials after delivered from the port are easily transported to the factories on covered vans. The only rail-based inland container depot is in the centre of Dhaka city but the factories are located outside the city. So, it is difficult to transport the export goods from the factories to that ICD amid the acute traffic congestion of Dhaka city.

The economy of Bangladesh is undergoing structural transformation. So there is no doubt that the growth of industry and service sector will continue to increase in the future. Therefore, Port infrastructure is required not only for importing raw materials for the production in the economic zones but also for exporting finished goods. After construction of the Padma Bridge Port facilities will also be needed for importing raw materials and exporting goods to and from those industries.

Beside domestic goods transport, demand for goods transport to the neighbouring countries like India, Nepal and Bhutan will increase. To meet this challenge infrastructure will have to be developed. Bangladesh lags behind in terms of logistics or supply chain management in the arena of global trade. Bangladesh achieved 100th position in World Bank’s latest survey on supply chain management. In this area, the Shippers’ Council, are presenting some recommendations. Firstly, vessels having upto190 metre length and 9.5 metre draft can be berthed at Chattogram port. If the shipping companies operate bigger feeder vessels on this route using this advantage the number of vessel will not be increased soon. Container transport per vessel will be increased if bigger sized feeder vessels can be operated in place of the old feeder vessels operating currently. At present on average 1768 TEUs import and export containers are transported on a vessel. The number of container transport can be increased without increasing number of vessel if the figure can be raised to 2000 TEUs per vessel.It would help easing the vessel congestion.

Secondly, new yards are required to lessen container congestion at the shore side. Congestion at the port yards can be reduced though shifting delivery of containers out of the port. Container handling from the vessels can be expedited by reducing number of containers at the yards.

Export containers can be reached and kept at the yards from before if separate yards can be set up and designated for such export containers.

Thirdly, port operation can be given to private sector. Port is a specialised service sector. Local operators have been operating the container terminals. But privatisation has not been done in this sector yet.

In India, globally renowned private operators have been running the terminals for last two decades. Operators like DP World, APM, PSAare operating there. The efficiency of Indian ports has been enhanced after the renowned operators took responsibility of the terminals. We also have no alternative to this. In this way, the local firms would be developed to international standard while efficiency in transport of cargo will be enhanced as well.

There is another issue. Coordination among many organization is essential in the stages beginning from the goods delivery from port to the export of goods. A powerful committee should be formed to coordinate the departments. Shippers’ Council of Bangladesh (SCB) was formed in 1979 aiming at promoting and protecting the interests of the exporters and shippers by coordinating local agents of the ocean going vessel owning companies operating in Bangladesh. Currently SCB coordinates with the representatives of the port, road transport and railway authorities as well as shipping companies for the speedy and cheaper transport of export and import cargoes. Since its inception it has been solving the issue of illogical surcharge imposed by the shipping companies through discussion and negotiation.

We hope that Bangladesh will go forward through facing new challenges in goods transport on sea routes.

The writer is Chairman, Shippers’ Council of Bangladesh, Email : [email protected]

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Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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