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A modern port waits for business
TRADE
Abul Kashem & Jahidul Islam
22 December, 2020, 10:35 pm
Last modified: 22 December, 2020, 10:40 pm
tbsnews.net
Summit Alliance Port authorities expect to break even in 2021
A truck can make three trips in a single night to transport cargoes from the country's first private inland container terminal located at Muktarpur in Munshiganj to factories in Dhaka.
Besides, shipment of containers between Chattogram and Muktarpur – through this terminal built on the bank of Dhaleshwari River close to Narayanganj – will also save time.
Although, the container depot with bonded warehouse and customs facilities has the capacity to unload imported goods within 24 hours, deliver export containers to Chattogram quickly through dedicated ships, exporters and importers hardly show any interest in using this port.
Only 48 out of the terminal's 400 are now working with not much pressure of container handling.
This Tk400 crore inland container depot, Summit Alliance Port Limited, was built by Summit Group In 2016.
In 2013, the government issued a notification allowing private investors to build inland container terminals to reduce pressure on Chattogram and Mongla ports and save businesses time and money on road transport.
This notice called for involving the private sector in construction of container terminals to speed up trade and enhance landing and shipping facilities, and utilise transit and trans-shipment benefits to boost economic activities.
In 2013, 15 lakh twenty-foot equivalent units (TEUs) of containers were handled through the country's two seaports and all of them were transported through road and rail routes. In the last fiscal 2019-20, container handling increased to about 29 lakh TEUs.
Despite frequent container congestion at Chattogram port, gridlocks on Dhaka-Chattagram highway and increased transportation costs, business people's interest in using the Summit's terminal has not grown to a desired level.
Sources say that importers are reluctant to use private inland container depots as there is no chance of misdeclaration of goods in such ports.
On many occasions in government ports, it is possible to import more than the declared quantities.
Many importers allegedly take such illegal advantages in exchange for bribes, they add.
But such unscrupulous practices are not possible in a private port where there is more surveillance. So, importers are less interested in using the private port, they point out.
On the other hand, exporters are not showing keenness in using the Summit Alliance Port owing to an urgency to reach export containers to mother vessels at the outer anchorage of the Chattogram port on time.
They said if container ships ply the Summit's terminal-Chattogram port route every day, it will be possible to transport exportable goods from here.
Summit sees good days ahead
Summit now sees great possibilities from January next year as it got permission to handle exports and imports of bulk and non-containerised cargoes last November to facilitate bilateral trade with India. Bangladesh and India have also added this inland container depot as a port of call under the Protocol on Inland Water Transit and Trade.
A large portion of industrial raw materials and consumer goods from India arrives in Bangladesh in bulk and break bulk forms. Often goods get stuck for a long time in Benapole. The port also remains closed occasionally because of different issues, the most recent being the shutdown of West Bengal during the pandemic.
Other issues that affect smooth shipment are work stoppage by clearance agents and truck drivers of both countries. Import activities with India via Muktarpur, as an alternative, will be much easier.
Abdul Hakim, chief operating officer of Muktarpur Inland Container Depot, told Business Standard, "Even 1% of our capacity has not been used yet. But we see great prospects for our port from next year."
Several companies, including DBL Group, Badsha Group, Akij Food, and Toma Steel are importing goods using this port while Damco, M&S, and others are exporting products through this container terminal, he added.
Hopefully, it will be possible to break even within next year. About 14 acres of land has already been purchased for the port's future expansion, he added.
"We started with high expectations. But entrepreneurs do not explore new possibilities leaving the way they are accustomed to doing businesses. We are still counting huge losses every month," Abdul said.
However, he thinks their future is promising. "Those whom we used to request for using our port have now started contacting us on their own. Many freight forwarders are also showing interest," he added.
Mohammad Hatem, first vice-president of the Bangladesh Knitwear Manufacturers and Exporters Association, an association of knitwear owners, told TBS that the Muktarpur port will be very useful for importers and exporters in Narayanganj. However, the port authorities have to ensure that ships go to Chattogram port every day with containers of export goods.
"Lead time has to be maintained for exports. If container transportation is delayed by a few hours, there will be a risk of missing mother vessels in the Chattogram port. In that case, the goods have to be brought back from the port."
Summit Alliance Port officials said they are going to buy a vessel to ship emergency import-export cargos between Chattogram and Muktarpur. And they have got permission from the government to purchase another ship.
The officials said the vessels will be bought when the use of the port will increase.
At present, 14 ships of different shipping lines ply the Chattogram-Munshiganj route everyday.
In 2013, Summit, AK Khan, Rupayan Group, Ananda Shipyard and Kumudini Welfare Trust got licences to set up private ports following the shipping ministry notification.
Of them, only Summit has already established the port while AK Khan Group bought the land in Narsingdi's Palash and Kumudini in Narayanganj's Khanpur.
Modern port infrastructure sits idle
During a recent visit to the Summit's port, four cranes were found with the capacity to handle containers weighing 40 tonnes. The port, constructed on more than 15 acres of land, also has the facilities, including warehouse, for importing, exporting and auctioning goods and modern equipment for physical inspection.
But all the facilities sit almost idle. No customs official was found at their respective workstations since there was no ship docked at the jetty.
"Customs officials reach as soon as we call them upon the arrival of a vessel," said Abdul Hakim, adding the port release imported-cargo laden containers round the clock without any harassment or additional fees.
In the meantime, Summit officials said it took a long time to get the approval from 37 public offices for the port. When the terminal got fully operational in 2016, the revenue board issued a customs bond licence policy for private inland container terminals.
The policy approved private inland container terminals to handle 20 imported items, including rice, wheat, flour, bitumen, cement clinker, soybean and cotton. The revenue board added another 19 items to the list as Summit applied to handle more products.
In July 2018, Summit again applied for container handling facilities for all types of products and got approval subsequently in November. And last November, handling of bulk and break bulk by private inland container terminals was approved too.
Beside policy support, govt needs to encourage traders for using port
To make full use of the port, Summit had been trying to get listed as a port of call in the country's trade by sea with neighbouring India.
In December last year, the shipping secretary-level meeting between the two countries announced inclusion of Summit's infrastructure as a port of call -- a place where a ship stops on a voyage.
When use of the port started increasing followed by the announcement, the pandemic hit businesses – plummeting imports and exports.
Officials at the Muktarpur terminal are hopeful that traders will use the port again once the situation returns to normalcy. However, they also sought government's policy support in this regard.
Hakim said if the government adopts a policy mandating trades of Dhaka and Narayanganj-based businesses through Pangaon and Muktarpur container depots, their capacity will be fully utilised.
"Previously, the government offered the businesses 20% of raw cotton import through the Pangaon port, but it did not work in the end. The port users also need to be motivated," he said.
Explaining the port facilities, he said it does not take a truck more than two hours to reach Muktarpur from Gazipur at night. From Dhaka, a truck can make three trips in a single night.
Hakim said the government has approved construction of an elevated expressway connecting Panchabati -- the entrance of Narayanganj -- and Muktarpur. The expressway will further ease the container transportation.
Abdul Hakim alleged the fare fixed by the shipping ministry for transporting goods by cargo vessels within the country is much higher than in other countries. On top of this, the shipping lines are overcharging the clients.
"To reach Chattogram port from Singapore, it costs $200 per container, while the next hop from Chattogram to Muktarpur, it costs $350-400. Yet, the amount is about half the cost of transportation by road."
According to a recent Planning Commission study, transportation cost of per tonne cargo is Tk4.5 per kilometre by road, Tk2.74 by rail and Tk0.99by waterways. Some 90% of the country's readymade garments are imported and exported by the Dhaka-Chattagram highway.
Any disruption on the highway badly hurts the apparel industry.
TRADE
Abul Kashem & Jahidul Islam
22 December, 2020, 10:35 pm
Last modified: 22 December, 2020, 10:40 pm
A modern port waits for business
Summit Alliance Port authorities expect to break even in 2021
Summit Alliance Port authorities expect to break even in 2021
A truck can make three trips in a single night to transport cargoes from the country's first private inland container terminal located at Muktarpur in Munshiganj to factories in Dhaka.
Besides, shipment of containers between Chattogram and Muktarpur – through this terminal built on the bank of Dhaleshwari River close to Narayanganj – will also save time.
Although, the container depot with bonded warehouse and customs facilities has the capacity to unload imported goods within 24 hours, deliver export containers to Chattogram quickly through dedicated ships, exporters and importers hardly show any interest in using this port.
Only 48 out of the terminal's 400 are now working with not much pressure of container handling.
This Tk400 crore inland container depot, Summit Alliance Port Limited, was built by Summit Group In 2016.
In 2013, the government issued a notification allowing private investors to build inland container terminals to reduce pressure on Chattogram and Mongla ports and save businesses time and money on road transport.
This notice called for involving the private sector in construction of container terminals to speed up trade and enhance landing and shipping facilities, and utilise transit and trans-shipment benefits to boost economic activities.
In 2013, 15 lakh twenty-foot equivalent units (TEUs) of containers were handled through the country's two seaports and all of them were transported through road and rail routes. In the last fiscal 2019-20, container handling increased to about 29 lakh TEUs.
Despite frequent container congestion at Chattogram port, gridlocks on Dhaka-Chattagram highway and increased transportation costs, business people's interest in using the Summit's terminal has not grown to a desired level.
Sources say that importers are reluctant to use private inland container depots as there is no chance of misdeclaration of goods in such ports.
On many occasions in government ports, it is possible to import more than the declared quantities.
Many importers allegedly take such illegal advantages in exchange for bribes, they add.
But such unscrupulous practices are not possible in a private port where there is more surveillance. So, importers are less interested in using the private port, they point out.
On the other hand, exporters are not showing keenness in using the Summit Alliance Port owing to an urgency to reach export containers to mother vessels at the outer anchorage of the Chattogram port on time.
They said if container ships ply the Summit's terminal-Chattogram port route every day, it will be possible to transport exportable goods from here.
Summit sees good days ahead
Summit now sees great possibilities from January next year as it got permission to handle exports and imports of bulk and non-containerised cargoes last November to facilitate bilateral trade with India. Bangladesh and India have also added this inland container depot as a port of call under the Protocol on Inland Water Transit and Trade.
A large portion of industrial raw materials and consumer goods from India arrives in Bangladesh in bulk and break bulk forms. Often goods get stuck for a long time in Benapole. The port also remains closed occasionally because of different issues, the most recent being the shutdown of West Bengal during the pandemic.
Other issues that affect smooth shipment are work stoppage by clearance agents and truck drivers of both countries. Import activities with India via Muktarpur, as an alternative, will be much easier.
Abdul Hakim, chief operating officer of Muktarpur Inland Container Depot, told Business Standard, "Even 1% of our capacity has not been used yet. But we see great prospects for our port from next year."
Several companies, including DBL Group, Badsha Group, Akij Food, and Toma Steel are importing goods using this port while Damco, M&S, and others are exporting products through this container terminal, he added.
Hopefully, it will be possible to break even within next year. About 14 acres of land has already been purchased for the port's future expansion, he added.
"We started with high expectations. But entrepreneurs do not explore new possibilities leaving the way they are accustomed to doing businesses. We are still counting huge losses every month," Abdul said.
However, he thinks their future is promising. "Those whom we used to request for using our port have now started contacting us on their own. Many freight forwarders are also showing interest," he added.
Mohammad Hatem, first vice-president of the Bangladesh Knitwear Manufacturers and Exporters Association, an association of knitwear owners, told TBS that the Muktarpur port will be very useful for importers and exporters in Narayanganj. However, the port authorities have to ensure that ships go to Chattogram port every day with containers of export goods.
"Lead time has to be maintained for exports. If container transportation is delayed by a few hours, there will be a risk of missing mother vessels in the Chattogram port. In that case, the goods have to be brought back from the port."
Summit Alliance Port officials said they are going to buy a vessel to ship emergency import-export cargos between Chattogram and Muktarpur. And they have got permission from the government to purchase another ship.
The officials said the vessels will be bought when the use of the port will increase.
At present, 14 ships of different shipping lines ply the Chattogram-Munshiganj route everyday.
In 2013, Summit, AK Khan, Rupayan Group, Ananda Shipyard and Kumudini Welfare Trust got licences to set up private ports following the shipping ministry notification.
Of them, only Summit has already established the port while AK Khan Group bought the land in Narsingdi's Palash and Kumudini in Narayanganj's Khanpur.
Modern port infrastructure sits idle
During a recent visit to the Summit's port, four cranes were found with the capacity to handle containers weighing 40 tonnes. The port, constructed on more than 15 acres of land, also has the facilities, including warehouse, for importing, exporting and auctioning goods and modern equipment for physical inspection.
But all the facilities sit almost idle. No customs official was found at their respective workstations since there was no ship docked at the jetty.
"Customs officials reach as soon as we call them upon the arrival of a vessel," said Abdul Hakim, adding the port release imported-cargo laden containers round the clock without any harassment or additional fees.
In the meantime, Summit officials said it took a long time to get the approval from 37 public offices for the port. When the terminal got fully operational in 2016, the revenue board issued a customs bond licence policy for private inland container terminals.
The policy approved private inland container terminals to handle 20 imported items, including rice, wheat, flour, bitumen, cement clinker, soybean and cotton. The revenue board added another 19 items to the list as Summit applied to handle more products.
In July 2018, Summit again applied for container handling facilities for all types of products and got approval subsequently in November. And last November, handling of bulk and break bulk by private inland container terminals was approved too.
Beside policy support, govt needs to encourage traders for using port
To make full use of the port, Summit had been trying to get listed as a port of call in the country's trade by sea with neighbouring India.
In December last year, the shipping secretary-level meeting between the two countries announced inclusion of Summit's infrastructure as a port of call -- a place where a ship stops on a voyage.
When use of the port started increasing followed by the announcement, the pandemic hit businesses – plummeting imports and exports.
Officials at the Muktarpur terminal are hopeful that traders will use the port again once the situation returns to normalcy. However, they also sought government's policy support in this regard.
Hakim said if the government adopts a policy mandating trades of Dhaka and Narayanganj-based businesses through Pangaon and Muktarpur container depots, their capacity will be fully utilised.
"Previously, the government offered the businesses 20% of raw cotton import through the Pangaon port, but it did not work in the end. The port users also need to be motivated," he said.
Explaining the port facilities, he said it does not take a truck more than two hours to reach Muktarpur from Gazipur at night. From Dhaka, a truck can make three trips in a single night.
Hakim said the government has approved construction of an elevated expressway connecting Panchabati -- the entrance of Narayanganj -- and Muktarpur. The expressway will further ease the container transportation.
Abdul Hakim alleged the fare fixed by the shipping ministry for transporting goods by cargo vessels within the country is much higher than in other countries. On top of this, the shipping lines are overcharging the clients.
"To reach Chattogram port from Singapore, it costs $200 per container, while the next hop from Chattogram to Muktarpur, it costs $350-400. Yet, the amount is about half the cost of transportation by road."
According to a recent Planning Commission study, transportation cost of per tonne cargo is Tk4.5 per kilometre by road, Tk2.74 by rail and Tk0.99by waterways. Some 90% of the country's readymade garments are imported and exported by the Dhaka-Chattagram highway.
Any disruption on the highway badly hurts the apparel industry.
