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Bangladesh, India to explore new concept of transhipment

Publication Date : 04-07-2012

 

Bangladesh has proposed providing transhipment facilities to India through its Chittagong and Mongla seaports by floating a new idea called “coastal shipping”.

India has instantly welcomed the offer and both countries agreed to explore the new idea for mutual benefit.

To this effect, Bangladesh has suggested signing an agreement or protocol for transhipment of Indian cargo by using conventional coastal vessels.

The proposal was made at a two-day shipping secretary-level meeting between Dhaka and New Delhi.

The meet ended yesterday with the signing of an agreement for renewal of the Protocol on Inland water Transit and Trade for the next two years.

Bangladeshi coastal vessels may be used commercially for transporting cargoes to and from India through Chittagong and Mongla ports, the proposal said.

Through implementing the plan, the rest of India will be connected with its east and south-east areas such as Visakhapatnam, Paradip of Orissa and Haldia of West Bengal.

Bangladesh will consider foreign exchange earnings and employment of crews in allowing the transhipment, it said.

Bangladesh Shipping Secretary Abdul Mannan Hawlader said yesterday the proposal to introduce coastal shipping between the two countries was demanded by the trade body of coastal ship owners in Bangladesh. According to ship owners, almost half of the inland and coastal vessels are unused.

“The cost will be very high if we carry goods from India by truck. But if we carry goods through the sea, the cost as well as travel time will be significantly reduced. Both countries can be benefited if coastal shipping is introduced.”

Hawlader said 98 per cent of vessels engaged in carrying goods under the water protocol are Bangladeshi although it has provision for a 50-50 use of Bangladeshi and Indian vessels.

Sources said the decision to introduce coastal shipping in the next few months has almost been finalised. However, the issue of customs fees and service charges were not discussed at the meeting.

There is also no mention in the proposal as to whether Indian ships will be engaged in carrying goods.

Officials said it had been decided that standing committees under the water protocol will look into the legal and technical matters of coastal shipping.

The committees will also submit reports regarding amendment of the protocol and introduction of coastal shipping within the next three months.

Indian Shipping Secretary Pradeep Kumar Sinha, who led an eight-member delegation at the meeting, told reporters that his country had welcomed the Bangladesh proposal and a joint committee had been formed to prepare reports in this regard.

A body led by the director general of shipping department and comprising representatives from the shipping ministry, Bangladesh Shipping Corporation, Chittagong Port Authority and Mongla Port Authority will soon visit Visakhapatnam and Paradip ports and Haldia. They will also talk to the Indian authorities.

The Indian side will also have a committee and prepare a report in this respect. Both the committees will submit their reports to their governments for a higher level decision.

Abdul Mannan Hawlader told journalists that the committee headed by the shipping department DG would submit the report within the next three to six months. The next steps would be taken if the committee found the proposal economically viable and feasible.

He said the coastal shipping would cover import, export and carrying of transit goods between the two countries.

Replying to a question, the shipping secretary said, “There has to be an agreement for the use of Chittagong and Mongla seaports to make coastal shipping operative.”

However, officials said it was yet to be decided whether the proposal of coastal shipping operation would be implemented through a new agreement/protocol or under the existing Protocol on Inland Water Transit and Trade that Bangladesh and India signed in 1972.

But competent sources said transhipment facilities would be provided to India under the existing protocol through necessary amendments.

Meanwhile, Bangladesh has also agreed to consider transit and transhipment of 35,000 tonnes of Indian food items to the northeastern states of the neighbouring country through Ashuganj-Akhaura.

“India proposed transporting 35,000 tonnes of food as relief materials and we said Bangladesh might consider this as a special case if relief materials are carried,” Hawlader said.

At the meeting, the Indian side placed eight proposals, including long-term validity of water protocol, transit operation and transhipment at Ashuganj for movement of cargo to its northeastern states, movement of truck and trailers through Akhaura-Agartala and a land customs station at Mongla port and a new port of call.

Dhaka's agenda was the operation of coastal vessels between Bangladesh and India, enhancement of charges for maintenance of routes (Sherpur-Zakiganj and Sirajganj-Daikhawa) and safety of navigation.

Meeting sources said India laid top importance on using Ashuganj river port for movement of cargo to its northeastern states, but regretted that Ashuganj had a shortage of necessary facilities, including infrastructure.

In response, the Bangladesh side said the government had taken up development projects to make the port fully-operational at a cost of US$62 million and also urged New Delhi to improve the port with Indian grants.

The Indian shipping secretary said his government would soon carry out a feasibility study on Ashuganj at its own cost and it was very much keen to take up a development project for the port.

Customs fees

The Bangladesh side proposed increasing customs fees and imposition of service charges and bank guarantees on Indian vessels.

But the Indian delegation questioned the logic behind the imposition of service charges as the goods were not being unloaded inside Bangladesh.

Dhaka said as customs officials oversaw the transportation of Indian goods through river routes, India must pay fees and service charges.

In this regard, a decision has been left to the revenue boards of the two countries. However, the fees and charges will be reasonable and honourable for both the countries.

New ports of call

A joint technical committee has been formed to study the feasibility of the Indian proposal for inclusion of the river Surma on the route under the protocol. The Indian side also proposed setting up new ports of call at Chhatak in Bangladesh and Dhubri in India.

India agreed as Bangladesh proposed that Badarpur could be declared an extension of Karimganj port of call. From now on Bangladesh flag carrier vessels will be allowed to anchor at Badarpur.

The Indian side also agreed to remove navigational problems for Bangladeshi vessels operating in the country and cooperate with Dhaka in fighting pirates.

 

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