Ports not geared to reap benefit from India connectivity

Seamless transport connectivity between Bangladesh and India will largely help Bangladesh tap into new business opportunities for which ensuring efficiency of the ports which are in the making should be the order of the day.

According to experts and businessmen, if Bangladesh is not well set to handle an increased volume of export-import trade in the wake of connectivity, it will weigh heavily on local trades while the ports will face huge congestions as waiting time for vessels will increase and foreign vessels will be reluctant to use such routesowing to unusual delays.

However, Chattogram Port Authority (CPA) and Payra Port Authority have said they are preparing to avail the ensuing opportunity.

Chattogram Port, the main port of the country, handles 92% of the country's booming export-import trade.

The port, which has handled 3 million TEUs (twenty-foot equivalent units) worth of containers last year, will be able to handle over 7 million containers by 2026 once Patenga Container Terminal, Matarbari Deep Seaport and Bay Terminal are completed.  

The under-construction Payra Port is expected to be fully functional by 2030 and will be able to handle 4-5 million TEUs worth of containers by 2035. 

According to a recently published World Bank report, "Connecting to thrive: challenges and opportunities of transport integration in eastern South Asia", seamless transport connectivity has the potential to help Bangladesh increase its national income by as much as 16.6% and India 7.6%.

The report noted that Bangladesh could increase its real income by 11.3% by allowing Indian trucks in the northeast-southwest and northwest-southeast corridors while real income for India will increase by 5.6%.

Improving transport connectivity between the two countries could increase exports even further, yielding a 297% increase in Bangladesh's exports to India, and a 172% increase in India's exports to Bangladesh.

On Tuesday, Prime Minister Sheikh Hasina and her Indian counterpart Narendra Modi virtually inaugurated the 1.9km Maitree Bridge over the River Feni that connects Ramgarh in Bangladesh with Sabroom in India's bordering Tripura state. Modi hoped the bridge would facilitate Tripura's access to Chittagong Port, 80 km from Sabroom end.

For freight and passenger transportation, Bangladesh already has got five rail routes with India. They are Benapole-Petrapole, Darshana-Gede, Rohanpur-Singhabad, Birol-Radhikapur, and Chilahati-Haldibari. Meanwhile, the Akhaura-Agartala and Dhaka-New Jalpaiguri train services are scheduled to open soon.

Additionally, the two countries now have nine roads and eight air routes.

There are also transshipment deals connecting India's north-eastern region with the rest of the country through Bangladesh's Chattogram and Mongla ports.

Terming the enhanced connectivity with India  positive, Prof Moinul Islam, former president of Bangladesh Economic Association, said:"Bangladesh will reap commercial benefits in the wake of this connectivity. However, it has to ensure services at the ports to make that happen'."

"The country will not achieve national income of as much as 16.6% overnight; it will increase gradually. It has a huge potential to tap once its ongoing projects are completed."

Patenga Container Terminal, which is scheduled to be completed by 2021, will have a cargo handling capacity of 4,50,000 TEUs yearly. Moreover, at Patenga, vessels of up to 10-meter draft will be able to berth. Currently at port jetties, vessels of up to 9.5-meter draft can anchor.

At the same time, the country's first-ever deep seaport at Matarbari in Cox's Bazar will be a major breakthrough for the country as here vessels of up to 14-meter draft can berth directly.

Around 1.1 million TEUs worth of containers are expected to be handled at Matarbari Port, which is expected to be completed by 2025. It is also expected that by 2041 container handling capacity here will increase to 1.4-4.2 million TEUs.

Another mega project -- Bay Terminal -- in Chattogram will be completed by 2026 in two phases.

Some 30-35 vessels of around 12-meter draft will be able to berth at a time at the Bay Terminal, which is expected to handle 5 million more containers. The terminal will not depend on tides and so vessels can berth 24X7.

According to the Chattogram Port Authority, by the next five to six years, the cargo handling capacity of the port is expected to rise to over 7 million TEUs.

Omar Faruk, secretary of the port authority, said: "We are increasing our capacity. By this time, we have carried out a trial run with India under a transshipment agreement. We are getting ready to tap into the opportunity."

The Karnaphuli tunnel will help in ensuring swift communication with Cox's Bazar and Tripura via Feni, Moinul Islam said, adding that it would reduce pressure on highways because of the long marine drive from Mirsarai to Teknaf.

"The bridge on Feni River will play a key role in carrying goods from Chattogram Port to the Seven Sisters in India, which will be of benefit since they are landlocked. If goods are carried from Chattogram to Tripura via Feni, it will benefit both Bangladesh and India commercially," he added.

For freight and passenger transportation, Bangladesh has already five rail routes with India. They are Benapole-Petrapole, Darshana-Gede, Rohanpur-Singhabad, Birol-Radhikapur and Chilahati-Haldibari.

Meanwhile, the Akhaura-Agartala and Dhaka-New Jalpaiguri train services are scheduled to open soon.

Additionally, the two countries have now nine roads and eight air routes.

There are also transshipment deals connecting India's north-eastern region with the rest of the country through Bangladesh's Chattogram and Mongla ports.

Businessmen's reaction:

Businessmen look on seamless connectivity as a good step forward in a booming of local businesses. However, they suggest developing the ports' capacity first, or else local trade will be under pressure as a result of congestion at the ports.

When contacted, AM Mahbub Chowdhury, vice president of Chattogram Metropolitan Chamber of Commerce and Industry, told The Business Standard that even after goods reach Chattogram port, it takes over 15 days to have them unloaded from vessels, which result in huge losses for traders.

Mahbub suggested changing the port management system and turning it into an efficient one through making it free of nepotism.

"We have to bring about a huge change to the container handling system at berth. Surprisingly, one berth operator company is handling six New Mooring Container Terminals, which is the cause for the delayin unloading containers in the port," said the business leader.

Mahbub called for the prime minister's direct intervention in developing an efficient port. Otherwise local business will be under more pressure.

Junior Chamber International Chattogram Cosmopolitan president Tipu Sultan Sikder said: "Even though the World Bank estimates substantial income growth in Bangladesh through seamless connectivity with India, we must look into the facts we confront at Chattogram Port, which lacksfacilities for the quick loading and unloading of cargoes."

The port is also struggling with cargo storage facilities, which lead vessels into overstaying for berthing, thus denting the reputation of the port, he said.

The businessman observed that the port's logistics support is not up to international standards and it has less draft, which prevents mother vessels from anchoring here.

If logistics support is not ensured, foreign vessels will be reluctant to use such a route due to delay, and for the delay in port, vessels will charge high freight, thus triggering an adverse effect at the price level, added Tipu.

How the port struggles

HPC Hamburg Port Consulting GmbH, a German company, has designed a 30-year master plan for Chattogram Port, which was unveiled in 2015. According to its forecast, the port has been running with excess capacity since 2018.

The research said the port's cargo handling capacity will reach 2.7 million Twenty-Foot Equivalent Unit (TEUs) by 2020, 4.4 million TEUs by 2025 and 5.1 million TEUs by 2030. By 2020, the port had handled 3 million TEUs. 

The premier port is still struggling with vessel waiting time, which has pushed up the cost of doing business and which is negative to port efficiency as shorter time is an indicator of increased port efficiency and trade competitiveness.

According to the 2019 report of the United Nations Conference on Trade and Development (UNCTAD), Bangladesh was lagging behind the neighbouring ports of India, Sri Lanka, Pakistan, Myanmar and Malaysia in terms of turnaround time.

UNCTAD saidturnaround time in 2019 was 3.03 days (72.72 hours) for Bangladesh, while it was 0.91 day (21.84 hours) for India, 0.83 day (19.92 hours) for Sri Lanka, 1.21 days (29.04 hours) for Pakistan, 2.04 days (48.96 hours) and 0.75 day (18 hours) for Malaysia.

Mahbub Chowdhury said: "The delay is mainly due to costly readymade garment sectors for which we miss our shipment, thereby raising the cost."

Sources said the port had also been struggling with storage capacity—it has the capacity to store only 49,018 TEUs containers.

The number of jetties has remained the same as they have been since 2007 at the country's premier port – Chattogram -- which used to handle only 0.9 million units of TEUs of containers at the time. That number reached around 3 million TEUs in 2020.

Of the 19 existing jetties only, vessels can berth at 18 and cannot anchor at the remaining one due to low draft. However, berthing also depends on high and low tides.  

For a long time the port jetties have not been developed in line with growth in export-import trade. Exporters and importers are incurring huge losses as much time is lost in the unloading of goods from vessels.

Moreover, only 9.5-meter draft vessels can berth at the port. As a result, mother vessels have to wait at outer anchorage and after unloading a substantial amount of goods, they can berth at port jetties.

Cargoes are also brought here from Singapore, Port Klang and Colombo through feeder vessels as mother vessels cannot come through Chattogram Port.