Infrastructure deficit slows cross-border trade

The Daily Star, October 21, 2014

Inadequate infrastructure and absence of harmonised working hours at land customs stations, banking services and motor vehicle agreements among Bangladesh, India and Nepal are deterring trade prospects through the Banglabandha-Phulbari-Kakarvitta route, a recent survey found.

The survey was conducted by India-based CUTS International and Bangladeshi non-governmental organisation Unnayan Shamannay, the findings of which were released yesterday at the Shamannay office in Dhaka.

Subsequently, trade potential between Bangladesh and Nepal has remained untapped, said Mahfuz Kabir, senior research fellow of Bangladesh Institute of International and Strategic Studies.

At present, there are harmonised working hours between Bangladesh and India but not between Nepal and Bangladesh, he said.

In absence of any transit agreements between Nepal and the other two countries, goods are required to change trucks at borders of each of the three countries. Transhipment causes higher costs and delays, said Kabir.

The survey finds that truck drivers and other stakeholders face severe problems for absence of truck terminals, accommodation and food at Bangladesh’s Banglabandha land custom station. The station handles 15-20 consignments of cargo daily.

The custom station does not get banking services for foreign exchange and lacks warehouses; the plant quarantine facilities are located 17 kilometres away.

Banking services are also absent at the Phulbari and Panitanki LCS on the Indian side of the route. While the Phulbari LCS is well-equipped with a warehouse, parking space and a weigh bridge, the Panitanki LCS is not.

The survey found that an LCS officer comes only three days a week at Panitanki.

The Kakarvitta LCS in Nepal though is well-equipped to handle present and future traffic, but the narrow and congested bridge between Panitanki and Kakarvitta LCS is a major problem.

Prithviraj Nath, policy analyst of CUTS International, said trade activities take place four days a week because of the mismatch in timings of LCS on trade routes.

Banglabandha LCS remains closed on Fridays, Kakarvitta on Saturdays and Phulbari on Sundays, he said.

Manzur Ahmed, an adviser of the Federation of Bangladesh Chambers of Commerce and Industry, recommended improved infrastructure of the Banglabandha LCS.

He also said a comprehensive agreement between the countries is needed to boost trade through the route.

Sohel Ahmed Chowdhury, a former commerce secretary, said the volume of trade through Banglabandha has not increased since its inauguration in 2004 because of inadequate infrastructure.

The Phulbari LCS in India is better-equipped, and it is vital to invest in trade facilitation and operationalisation of the LCS to boost trade volume, he said.

Chowdhury suggested for making laws of the three countries compatible for trade facilitation.

He also favoured a tripartite understanding among the neighbours to promote trade, tourism and economic development and boost trade through Banglabandha-Phulbari-Kakarvitta route.

The former secretary said Banglabandha will be an important port if overseas trade of India’s northern region takes place through it.

The CUTS International survey recommended for motor vehicle agreement and transit deals between Bangladesh and Nepal and Bangladesh and India to aid cross border movement of truck, upgrading bridge infrastructure at Nepal and harmonisation of standards as long-term solution.

This news item can also be viewed at: