Is Haldia an alternative to Chittagong?

In the wake of the ever-increasing congestion at the Chittagong port, the move by a section of the country's shippers to use Kolkata's Haldia port as an alternative arrangement for carrying international trade cargo to and from Bangladesh has sparked a controversy over its wisdom. There are arguments, both for and against, and so the merit of the proposition calls for detailed examination.

The basic idea is to use Haldia as a transhipment port to receive or send containers to, and from, Colombo or Singapore. The proposed route is Pangaon-Haldia-Colombo or Singapore. Reports have it that some shippers, including a few big operators in the sector, are keen to rush into the move on the basis of what appears to be a surface reality. But as of now, this has not been examined in the light of ground realities and comparative advantage in quantified terms. Activating the Pangaon port, which, despite many stray efforts, is far from being fruitful, is another issue that the shippers are in favour of, while trying to convince the government about the alternative arrangement. In fact, at a high-level meeting months ago attended by the Finance Minister and the Shipping Minister, the issue of enhancing the capacity of the Pangaon inland container terminal (ICT)  by sending cargo through it via Haldia instead of Chittagong came up for discussion, as a recourse to reducing congestion at Chittagong port. The idea of using Haldia as a preferred option may have emerged from that meeting.

It is, however, highly premature to push the idea forward without examining the pros and cons. Concerned quarters are of the view that using this transhipment arrangement will involve at least US$ 200 as an additional cost for each 40-feet container. However, if the lead time is significantly less than that of transporting through Chittagong, it might turn out to be advantageous. Bangladeshi shippers eager to use Haldia as a transhipment port are apparently counting on shorter lead time. However, shipping experts do not seem to endorse the prospect as bright enough to beat Chittagong. Some of them consider that rerouting trade cargo via Haldia would take three more days to reach Colombo port.

Obviously, the issue needs a lot of brainstorming, especially by the lead chambers and business bodies. There has to be a synchronisation of views of traders, shippers and the government. There is also the issue of revenue loss by the Chittagong port. The recent congestion in Chittagong port is largely attributed to the absence of advanced equipment, namely gantry cranes, among others. Concerned quarters are of the view that improving the port facilities will involve not only procurement of equipment but also major renovation activities. The latter is bound to be time consuming.  Until such time, finding an alternative arrangement is not unlikely, but that has to be a well-thought-out one and not at the expense of the country's trade. So, all stakeholders should wait for a detailed scrutiny of the matter in order to arrive at a decision.