Small and large investments are made in the country. Import-export is increasing. As a result, the scope of work is expanded. But a major problem in this area for a long time has been the poor logistics facilities. It not only hinders imports and exports; Increasing unnecessary costs for entrepreneurs. The exporters are lagging behind in the competition from world trade. In many cases, this affects the product price.
The country’s logistics sector lags far behind international standards. Agility Logistics, the world’s largest logistics service provider, has recently compiled an index covering the logistics of 50 emerging countries. Bangladesh ranks 39th in this index. In this respect, Bangladesh is lagging behind the South Asian countries of India, Pakistan and Sri Lanka. The majority of the country’s imports and exports go through the port of Chittagong. But due to a lack of efficient management in container transhipment, lack of harbor yard, absence of harbor pilot and modern equipment, this port is in the back row among Asian seaports.
However, a recent study found that improving the logistics sector could increase Bangladesh’s exports by 20 percent. This makes it possible to attract foreign investments of 15 billion dollars in the coming years. To this end, the experts consider it necessary to formulate national policy on this point.
All infrastructure, transportation, management, and technical support needed to quickly carry out general trading activities, including imports and exports, are considered the logistics industry as a whole. Its scope is enormous. From road, rail and waterways in the transportation of goods to port infrastructure, goods unloading and storage, refrigeration and container facilities and the management of these works, many issues fall under the remit of logistics facilities. Logistical facilities are necessary in all activities from importing a product, through production to reaching the consumer.
According to researchers, the transportation logistics market is currently worth about $15 billion in the country alone. It is equal to 6.8 percent of GDP. More than 1,000 companies are involved in the transportation of foreign trade goods from Bangladesh. The size of the entire logistics sector is much larger than with other services. However, no specific information was found about this.
Kabir Ahmed, chairman of the Bangladesh Freight Forwarders Association, told Samakal that ships often run aground in seaports. Import and export costs are increasing. The airport also does not have the necessary number of machines to transport goods. Cargo village, cargo area, cargo security issues.
According to a research paper by Professor Mamun Habib of the Independent University, Bangladesh (IUB) School of Business on the logistics sector, 20 percent more trucks than usual are needed to transport additional goods during Ramadan. Roads cannot handle this extra load of trucks. Most roads have long traffic jams. Day after day, 20 to 30 ships wait in the harbor to transport and unload goods. As a result, the product supply chain is severely disrupted. There are also complications at the airport. There are many reasons including failure of scanning equipment, customs complications, lack of product storage, etc. Imported goods tend to pile up twice as much as the warehouse capacity. On the other hand, traders have to face many difficulties to get an ICD license.
Those involved in this sector believe that the private inland container depots (ICD) should be expanded. They said there are currently 19 private ICDs in Chittagong. It has a capacity of 76 thousand TEUS containers. It should be increased by another lakh TEUS. Currently, private investment in this sector is about 2000 crore rupees. More investment is needed to increase export trade.
According to traders, there are also obstacles in attracting investment by foreign logistics operators due to a lack of logistics-related policies. The management and regulatory system for container movements in the Port of Chittagong is complex. There are policies that are not conducive to efficient port management. Private sector participation in port activities is limited. The depth of the port of Chittagong is less than in other countries in South Asia. The cost of logistics in the country is also very high. Improving the logistics index is essential to increase exports.
Dhaka Chamber of Commerce and Industry (DCCI) President Rizwan Rahman said at a recent event that by developing the overall capacity of the Port of Chittagong, it is possible to reduce the operating costs of the trading and investment activities of the Dhaka country significantly. In addition, he considers it necessary to carry out the activities of Bay Terminal and Patenga Terminal through the master plan, dredging capital, increasing the capacity of the jetty and improving the road and rail connection with the port.
According to industrialists, if production and exports in 100 economic zones of the country are running at full capacity, the supply of goods by road, sea, rail and air will increase several times than at present. Efficient logistics management will be needed to handle this huge event. Currently, 9 ministries and 21 departments oversee various logistics activities. This adds complexity. A separate ministry or department is needed to direct these activities. In addition, more attention must be paid to water communication in order to reduce road dependency. Railways must be given priority. Dhaka-Chittagong highway is to be converted to eight lanes to reduce traffic congestion.
Professor Mamun Habib told Samakal that the country’s logistics sector has great potential. But there are also many challenges. There are infrastructural and transportation problems and a lack of skilled labor to handle goods in three places, namely Dhaka Airport, Chittagong Port and Inland Container Depot (ICD).
He said logistics and supply chain management are not taught in universities. As a result, no skilled labor is created in this sector. Skills must be acquired to take digital advantage of import-export, transaction and communication. This requires government policy decisions and new initiatives.