Yesterday’s opening of the Padma Bridge has given connectivity a boost as it will slash the time it takes to move goods between the southwestern region of Bangladesh and the capital by two to four hours, reducing thus the cost of business.
And companies say the longest bridge over the mighty river will become an economic game-changer if $7 billion is invested in the logistics sector in the southwestern districts.
The greater connectivity will improve the activities of three ports, namely Benapole, Payra and Mongla. As a result, the pressure on Chattogram Port, which handles more than 90 percent of Bangladesh’s maritime trade, and the Dhaka-Chattogram Economic Corridor will decrease by almost 15 percent, they said.
It is estimated that an investment amounting to $20 billion is needed in Bangladesh to raise the country’s poor logistics services to world standard.
At least a third, or almost $7 billion, should be invested in the southwestern part to improve the logistics sector so that the economic lifeline of the region gets a boost, according to Ms. Masrur Reaz, Chairman of Policy Exchange, Bangladesh, a private think tank. Tank.
“After the opening of the Padma Bridge, a big step has already been taken towards improving connectivity.”
The region, which consists of 21 districts, is a producer of agricultural products such as vegetables and agro-processed foods.
Thus, the construction of inland container depots, storage facilities, cold chains, freight transport facilities and better terminals are important, according to Reaz.
The region is set to experience a major transformation in the years to come.
For example, industrial units could be set up there. So a mega logistics development project can be mistaken for further improvement, Reaz said.
He believes an immediate investment of $7 billion in logistics is needed to utilize the economic potential of the region using the Padma Bridge connectivity.
The Dhaka-Chattogram corridor, made up of roads and highways, is already overloaded as it controls more than 85% of Bangladesh’s international trade worth $160 billion.
“The Padma Bridge has opened up another economic corridor and we must utilize it by improving logistics services as soon as possible,” Reaz said.
For example, farmers in Munshiganj produce a lot of potatoes, but many of them do not get fair prices. If farmers have the option of storing them for a few months in cold storage at a cheaper rate, they can get a better price.
AK Azad, Chairman of Ha-Meem Group, an exporter and importer of garments and textile products, and Md Fazlul Hoque, Managing Director of Plummy Fashions Ltd, said that using Mongla Port would reduce lead time.
But the port must be prepared, added Hoque.
Chowdhury Zafar Ahmed, Secretary General of Bangladesh Covered Van, Truck, Prime Movers Goods Transport Owners Association, thinks the use of any port depends on importers and exporters.
There is no doubt that using Mongla Port will reduce the transportation time, he said.
Abul Kasem Khan, former president of the Dhaka Chamber of Commerce and Industry, says nearly 40% of perishables are wasted due to transport delays.
“Thus, the establishment of cold chains in the South West region is important to prolong the shelf life of perishables.”
Cold chains are even more important for the southwestern districts since the region is one of the hubs for agricultural products and related businesses.
Md Rezaul Alam, COO of Nippon Express Bangladesh, a logistics joint venture between Bangladesh and Japan, hopes his company can invest in logistics in the region as road connectivity has been established through the Padma Bridge.
“If the proposed airport is built on the other side of the bridge, international logistics companies will fly there.”
He urged the government to allocate land to logistics companies so that they can build large warehouses and other facilities for storing and transporting goods.
Syed Ershad Ahmed, President of the American Chamber of Commerce in Bangladesh, suggested using the potential of the ports of Benapole, Mongla and Payra to attract international logistics companies.
He says Jashore produces a lot of flowers, which have export potential. But sales abroad remained at a negligible level.
“If cold chains can be built, the flowers can be stored for later export. So the establishment of infrastructure is very important now,” said Ahmed, who is involved in the logistics sector.