The Financial Express

Private depots warn shipping companies of service halt from February 1

| Updated: January 29, 2022 12:03:50


A section of private container depots warned the shipping firms concerned of discontinuing their services from February 01 unless the shippers confirm 23 per cent increase in their tariff.

Discontinuation of services by the dry-ports means that the country's shipment may face troubles, as the depots handle cent per cent export, amounting to over US$ 38 billion. Besides, the depots also handle around 25 per cent of Bangladesh's total import.

Earlier, the Bangladesh Inland Container Depots Association (BICDA), a group of 17 depots, issued a circular by reviewing the existing tariff by 23 per cent on the ground of fuel price hike in the country.

The government raised the prices of diesel and kerosene at retail level by Tk 15 per litre from November 04, 2021.

After the rise in fuel prices, the BICDA reviewed the tariff, arguing that the depots are incurring additional cost since then due to the increase in fuel price.

An email communication (of a depot) with a mainline operator (MLO), obtained by the FE, reads: "Non-acceptance of reviewed tariff on your part (MLO) for about three months has put us in a position, where we are no longer able to meet both the ends and provide you with uninterrupted service at the same time".

It also reads: "In the light of the above, we will not be able to provide you with uninterrupted services from February 01, 2022 due to incurring additional cost of operation, unless we receive your confirmation of acceptance of 23 per cent increase tariff by January 31."

When contacted, BICDA spokesperson Md Ruhul Amin Sikder (Biplob) told the FE on Friday afternoon: "We did not issue any warning letter; but individual depots have issued such warning, as they cannot sustain the rise in operational cost."

Earlier, BICDA President Nurul Qayyum Khan told this correspondent, "We're providing our services to the traders despite incurring loss mainly due to the fuel price hike."

In the meantime, the Bangladesh Container Shipping Association (BCSA), a group of container service providers in the country, said the depots did not comply with competition law while reviewing the new tariff.

A letter, prepared by the BCSA and sent to the BICDA, reads that they were prohibited to discuss or negotiate any price increase on a collective platform.

It also reads: "We urge you to advise your members for a mutual and win-win bilateral negotiations with our valued members. Our member lines will urgently discuss the issue with your members individually soon within the first week of February".

The letter also requested the trade-body (the BICDA) to be flexible in timing to conclude the deal.

[email protected]

Share if you like