New facility to cut lead time, transport costs for exporters, importers

Lead time and transport costs are likely to be reduced significantly as a new provision will allow investors at export processing zones to use same containers for export-import shipments.

Investors and officials said the facility, which has long been sought by investors, mainly by Japanese, will help cut congestion, transport costs, carbon emissions and environmental pollution.

The National Board of Revenue (NBR) will issue a gazette soon as an order has already been issued on standard operating procedure, allowing container round use of EPZ companies.

Presently, an estimated 500 exclusively export-oriented companies in eight EPZs hire full container from a shipping agent separately for transporting export-import goods under a 1984 rule.

According to the Customs (Export Processing Zone) Rule-1984, import container can deliver goods only from seaport to EPZ after completion of custom clearance.

This container must return at CFS empty.

For the reason, sources said, the enterprises have to contact the C&F agents for requisition of another empty container at the time of exporting goods.

Bangladesh has 18 nearly container freight stations, most of which are located far from EPZs, creating pressure on the road for running separately.

"It was an operational problem with lots of complicated rules which have been maintained to ensure duty-free facilities to enterprises. The new rule simplifies the procedural complication," said an official.

He said the new rule will not only expel the earlier rule of the necessity for cancelling container through the process of sending back it to freight stations.

It also allows other investors to use the container in case the hired company does not have any export materials after unloading imported goods, he added.

Nazma Binte Alamgir, general manager (public relations) at the Bangladesh Export Processing Zones Authority (BEPZA), said the initiative will save both travel time, costs, fuel consumption and the environment.

This will not only help busy EPZs close to airports or ports, but also distant ones like Nilphamari utilise the container service efficiently, she mentioned.

Sources said the Japan External Trade Organisation (JETRO) has long been negotiating with the NBR for changing the rule to reduce congestion at ports, eliminate severe shortage of heavy driving licensed drivers and improve transportation productivity.

Hailing the new initiative, JETRO country representative Yuji Ando hoped ministries concerned and the NBR will make more efforts for smooth operation of EPZs as multiple issues are still to be addressed.

Japan sought this facility for improving transportation efficiency and cutting the cost half, he said.

"I believe this will be a big improvement in business environment in EPZs," Mr Ando told the FE in an email.

The EPZs have been witnessing increased operation as more than 500 enterprises are playing a pivotal role in export growth significantly.

From 2009 to June 2020, investment increased by more than three times, escalating exports by 400 per cent.

Operational industries rose by 45.53 per cent. Eight EPZs have an estimated $4.0-billion foreign direct investment.

[email protected]