The government is set to take a number of initiatives to make Pangaon Inland Container Terminal (PICT) fully operational through encouraging the exporters and importers to use the waterways between Dhaka and Chittagong for transportation of their goods.
Located at Keraniganj on the bank of River Buriganga, the terminal virtually remains idle since its inauguration in November 2013.
National Board of Revenue (NBR) would work together with a number of ministries and launch marketing strategies to keep in touch with business and provide benefits for the users, officials said.
It is likely to hold an inter-ministerial meeting with the shipping ministry to rationalise the vessel and port tariffs – considered as a major reason why the terminal is not being used, they added.
Bangladesh Inland Water Transport Authority (BIWTA) and Chittagong Port Authority (CPA) have jointly constructed the Pangaon ICT at a cost of around Tk400 crore to help reduce the cost of carrying goods and ease the traffic congestion on the Dhaka-Chittagong highway.
The port has modern infrastructural facilities and international standard equipment, including forklift, tractor trailer, mobile harbor crane, straddle carrier, cargo lifting crane, etc.
It, however, remains inactive as the authorities have failed to attract users mainly due to lack of campaign and marketing strategies, terminal sources said. The government has to spend over Tk40 lakh per month as operational cost and staff salaries.
The terminal has a storage capacity of 3,500 TEUs (twenty-foot equivalent units) and is capable of handling around 1.16 lakh containers annually.
In comparison, it has so far handled nearly 850 containers, mostly empty ones, since its inception. In June, a water vessel reached Pangaon with only 10 goods-laden containers.
In the fiscal year 2014-15, only six vessels reached the PICT from Chittagong Port, carrying mostly the empty containers, officials said.
Currently, the users are not using the port for import of capital machinery and raw materials for production, which holds major share of the import. Rather, the Pangaon port is now handling containers with products like glassware and stationary goods. Only 29 goods-laden containers remained stored in the Pangaon ICT as of yesterday.
The CPA usually handles major share of containers that come into Bangladesh from different countries. Around 75% of these containers, mostly bound for Dhaka and Narayanganj, are transported through roadways while only some 10% to 12% are being transported through rail links, and the rest through river ways, according to CPA officials.
If PICT is used to transport goods, it can save around 40% cost and help reduce traffic congestion on the highways, officials said, adding that it is only possible if proper campaign is launched.
However, businessmen alleged that the transportation of goods through Pangaon ICT is not cost-effective yet as compared to Kamalapur ICD. Irregular vessel schedule is another reason behind the situation.
Exporters Association of Bangladesh President Abdus Salam Murshedy said the transportation of goods through Pangaon is not time consuming, rather it is more expensive than other modes of transportation.
“We are also facing problems while opening Letter of Credit (LC) as there is no office of shipping agents in the terminal,” he said. “The NBR has to assure us that we can import and export products directly through Pangaon. Otherwise it would not work.”
The Pangaon ICT will have to provide tax rebate like the benefit provided by Mongla Port to attract users, he added.
According to a recent report prepared by Pangaon Customs House, the port remains unutilised mainly due to the higher cost of container vessels and other port charges as compared to Kamalapur Inland Container Depot.
Lack of container and irregular schedule of vessels also discourage importers and exporters, the report said, urging the tax authorities to hold inter-ministerial meeting involving the shipping ministry to solve the problems.
Acknowledging the fact, Pangaon Customs House Commissioner Mostoba Ali told the Dhaka Tribune yesterday that the vessel schedules are now irregular due to lack of containers, but it is possible to overcome soon.
“It is true that the tariffs are higher than Kamalapur ICD, thereby discouraging users. But the shipping ministry is now working on rationalisation of the charges,” he said. “We are having meeting with stakeholders and the issues will be solved soon.”
Currently, the CPA operates three vessels on the route but without schedule due to lack of containers. The authority is inviting multinational companies and big firms to use the port as a legitimate trade facilitation way, he added.
Users have to bear a total of $138.27 for transporting up to 15 tonnes of imported goods from Chittagong to Kamalapur ICD by rail routes as compared to $206.25 through waterways to Pangaon, according to the report.
During exports, the same volume of goods costs $80.87 from Kamalapur to Chittagong by railway as compared to $206.25 from Pangaon to Chittagong - over 2.5 times higher.
Chittagong Chamber of Commerce and Industry President Mahabubul Alam said the waterway requires three to four days to transport products through Pangaon as compared to only 12 hours through roadways.
NBR Chairman Nojibur Rahman said the board is preparing a plan to make the port operational by three months. “We have decided to remain engaged with a time-bound action plan,” he said, adding the board will work together with the ministries like of agriculture, shipping, telecommunications, science and technology.
