News / Shippers fear Indian cargo ruling will add to congestion at Chittagong

© Abhijet Kar

Shippers using Bangladesh’s Chittagong port fear there is not enough capacity, following the country’s decision to open its two seaports, Chittagong and Mongla, to Indian domestic cargo destined for seven states in the north-east.

Bangladesh Customs on Tuesday issued an order allowing India to start regular cargo routes through Bangladesh for goods to feed people in the hilly northern region, where both industrial and farm production is lacking.

India will send the majority of goods from neighbour state West Bengal, using Chittagong and Mongla ports.

Without permission to move goods through Bangladesh, India’s trucks had to travel 1,650 km from West Bengal to Agartala, through Guwahati in the landlocked north. Now, cargo can be transported over just a few hundred km, cutting costs and time.

According to local officials, the new order means India will no longer need to seek permission from the customs authority to send cargo using Bangladeshi ports.

Bangladesh and India originally signed an agreement on the use of Chittagong and Mongla for goods to and from India in October 2018. Since then, there have been six trial runs to check the viability of a regular transit of Indian goods.

After Indian cargo reaches Chittagong and Mongla ports by ship, they will be carried to the north-eastern states by road. The containers will be under sealed lock and escorted by customs officials to avoid any discharging them inside Bangladesh.

In return, Bangladesh will earn revenue from port dues, transhipment fees, processing fees, road use charges, scanning charges, escort fees and administrative fees.

However, local shippers say this will be paltry, compared to the hassle created when India begins carrying an increased volume of goods, adding that the capacity of Chittagong and Mongla ports is insufficient.

They claim the increased volumes to and from India will heighten challenges now faced by local traders in already congested ports, especially Chittagong.

Alamgir Hossain, an electronic goods shipper, said: “We should have increased the port capacity before providing the India transit facility.”