Operators propose 70pc tariff cut for survival

Operators of Pangaon container terminal, long lying underused, now believe a drastic cut in charges may help enhance operational activities, needed for its sheer survival.
People familiar with the situation pointed out that while there has been a container jam at Chittagong seaport for handling constraints, this terminal in Dhaka was lying almost idle for lack of container-carrying vessels.
A high official at the terminal said they proposed to the government a 70 per cent reduction of the existing tariff rates that traders find much higher than rail-freight charges.
Sources told the FE that there are wide differences between tariff rates the terminal charges and that of Kamalapur depot. Both are owned by the Chittagong Port Authority (CPA).
According to tariff structure, a 20-foot container needs Tk 9,000 for lift-on and-off cargoes at Pangaon. Lift-on in shipping is just loading onto container carriers bound for Pangaon in Dhaka. Lift-off means unloading containers from ships onto the ground.
The same costs nearly five times less if the importers bring the cargo to the Kamalapur inland container depot by rail wagons.
Ahmed Karim, manager at the Pangaon Terminal, said: "This terminal still remained underutilised and we believe this is simply because of the tariff differences."
He said this high tariff is causing a cascade effect on the system.
Cascade effect is an inevitable and sometimes unforeseen chain of events due to an act affecting a system.
There is a possibility that the cascade effect will have a negative impact on the system. He pointed out that the Chittagong Port and all the private depots in Chittagong are now jammed with containers although the terminal remained almost vacant.
He said considering this gap, they had proposed downsized review of the tariffs. The proposal is now at the Ministry of Finance.
There are many other tariffs involved in handling containers at Pangaon, and cut proposals are also now lying at the Ministry of Finance for approval.
People familiar with the matters at Chittagong Port said the other moves undertaken by the government to prop up the activities at the terminal yielded nothing.
The government had made mandatory the use of the terminal for cotton importer for up to 20 per cent of the consignment last February. But statistics show that this also remained much low.
Rather, the terminal is mostly being used by steel-scrap importers.
Currently, nearly 100 containers usually remain at the terminal against its capacity of 3,500 twenty-foot-equivalent units.
As of Saturday, the statistics show that 93 TEUs were at the Pangaon terminal. On the other hand, Kamalpur ICD held more than 2,500 TEUs.
Three river-sea container vessels owned by the CPA ply the Dhaka-Chittagong river-sea route. But for lack of containers, a vessel arrives at Pangaon every 10 days with around 50 TEUs. The vessels have the capacity to carry 120 TEUs.
The inland container terminal was built at a cost of Tk 1.5 billion at South Keraniganj's Pangaon in Dhaka. This is jointly built by CPA and Bangladesh Inland Water Transport Authority (BIWTA).
They first signed agreement in May 2005. But the terminal was for use in June in 2013.
The Pangaon Inland Container Terminal was inaugurated in 2013 formally. Prime Minister Sheikh Hasina inaugurated it on November 07, 2013.
The terminal has 180-metre-long jetty with 55,000-square-metre backup facility to handle containers.
jasimharoon@yahoo.com [Read More]

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Source: The Financial Express


 

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