How access to Chattogram and Mongla ports could bolster India’s trade and connectivity

On 25th April, the National Board of Revenue (NBR) of Bangladesh issued a ‘permanent transit order’ that stated that transshipment of cargo will be done in line with standard operating procedures finalised by the two countries under an agreement signed in 2018. In early April, Bangladesh’s Minister of State for Shipping Khalid Mahmud Chowdhury made a statement regarding the forthcoming launch of operations for transit and transshipment of cargo between Northeastern India and Bangladesh, with Chittagong Port as the main access point.

India and Bangladesh have been working since a long time to strengthen their trade ties by simplifying augmenting their supply chain network – on water, road, rail and in the air.

Bangladesh’s decision to grant India access to its Chattogram and Mongla ports is a significant development towards boosting regional connectivity and trade between both the countries. An important outcome of this decision will be the reduced time and cost for transporting goods to India’s northeastern states and West Bengal.

The NBR’s order was issued after the completion of trial runs for the operationalization and regular movement of goods. Bangladesh’s ports, customs, and other taxation parties involved will draw certain charges in line with the country’s tax and VAT laws, including fees for documentation, transshipment, security, scanning, administrative charges, electric lock and seal fees, and toll fees for using Bangladeshi roads.

Chattogram Port, situated in the southeastern region of Bangladesh, is the country’s primary seaport and manages more than 90% of Bangladesh’s export-import trade. On the other hand, Mongla Port is the second-largest seaport in Bangladesh, located near the Bay of Bengal’s coastline. With the newly acquired access to Chattogram and Mongla ports, the challenges of transporting goods to India’s northeastern states will be addressed.

By utilizing the Mongla port, India can establish better connectivity of its northeastern states with other parts of the country by avoiding the narrow Siliguri Corridor, commonly known as the ‘Chicken’s Neck.’ As per a report by ORF, eight routes have been identified for connecting India’s northeastern region through Bangladesh’s seaports. These routes include Chattogram or Mongla Port to Agartala (India) through Akhaura (Bangladesh); Chattogram or Mongla Port to Dawki in Meghalaya (India) via Tamabil in Sylhet city (Bangladesh); Chattogram or Mongla Port to Sutarkandi in Assam (India) through Sheola (India); and Chattogram or Mongla Port to Srimantpur in Tripura (India) via Bibir Bazar (India).

Additionally, the use of these ports can help to establish better regional connectivity in the Bay of Bengal, proving to be beneficial to both countries in the long run. As these ports are strategically located near the Bay of Bengal’s coastline, they can serve as a gateway to Southeast Asia, allowing India to expand its trade and connectivity with the larger region.

Access to these ports will also provide India with an alternative to its traditional route of transporting goods through the Kolkata port, which is often congested and prone to delays. By diversifying its routes, India can reduce its reliance on a single port and ensure a more efficient and reliable transport network.

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