Inefficiency costs importers Tk 12b a yr

Importers incur around Tk 12 billion in losses every year due to delayed cargo unloading at Chittagong port caused by a shortage of lightering vessels and jetties.

The importers hire foreign vessels, with an agreement to unload roughly 3000 tonnes every day. But the vessels have to remain beyond schedule until the goods are unloaded. The importers have to pay overseas ship companies $10,000 to $16,000 on average for every day that a vessel overstays.

According to Chittagong port authorities, the port has 1,450 lightering vessels and six jetties.

The importers, however, said that the port right now needs 500 more lightering vessels and inclusion of two jetties every year for container-less vessels.

Not a single jetty has been built since the country's independence for container-less goods like steel, raw materials for cement production, and other essentials, said the businessmen.

Local steel manufacturer BSRM Group imported 603,481 tonnes of raw materials for steel manufacture last year in 25 ships. The company had to count losses of $7.5 million as it could not unload the goods on time. The company compensated overseas ship companies $1.2 million in 2016.

BSRM Group executive director Tapan Sengupta told Prothom Alo that at least two or three ports can be constructed with the money that is going abroad every year for lack jetty facilities.

Abdul Monem Sugar Refinery Limited could not unload raw materials for sugar production on time for lack of lightering vessels.

Director general of the company, Abdul Haque, said, ''We had to count losses of around Tk 160 million. It's difficult to conduct business in this manner.''

According to the businessmen, they have to incur a loss of Tk 11.95 billion every year for inefficiency and mismanaging at the prime port of the country. 

Large cargo vessels cannot directly anchor at the jetties of the Chittagong port. These vessels anchor at the outer anchorage, some 16 kilometers away from jetties. The goods are shifted from large cargo vessels to lighter ships by cranes at the outer anchorage.    

The goods are unloaded from lighter ships at 39 spots including Chittagong, Dhaka and Narayanganj.  

In 2017, goods were unloaded from 1,327 ships at the outer anchorage and jetties at the port.

It did not take long to unload goods from 127 ships.

Out of 1200 ships, Prothom Alo got information about the unloading of 743 ships.

On an average, 1306 tonnes of goods are unloaded from these ships daily.

As per conditions of shipping companies, more goods are supposed to be unloaded. These cargo vessels remain ten days more than the stipulated time.

If per day compensation is estimated at 12,000 dollars, the total compensation will stand at Tk 11.95 billion.

Chittagong chamber president Mahbubul Alam said per kilogram imported goods cost Tk one to one and half times higher last year due to compensating the foreign shipping companies.

Speaking to Prothom Alo, Mahbubul Alam said all importers including City, Basundhara, Meghna, Aman Group, Sheikh Brothers, Mosharraf Brothers have had to compensate.

Some 250 lighter ships can be bought from the money compensated in the last year.

Businessmen said the compensation money is ultimately collected from the pockets of the consumers.

When goods import increased through the port, the shipping department imposed a ban on building lighter ships on 1 December 2015.

The ban was withdrawn in September of 2017. But the import of goods increased by 35 per cent in last two years.

Shipping department director general commodore Syed Ariful Islam, however, does not think there is a shortage of lighter ships in the country. On the contrary, he claimed various other problems that cause delay in unloading goods.

The businessmen, however, do not think so.

It took 73 days to unload 52,500 tonnes of wheat from a ship. TK Group imported this wheat.

Director of this group Tarique Ahmed said about Tk 180 million had to be paid in compensation due to shortage of lighter ships.

Lighter ships are allocated in favour of private firm Water Transport Cell, for shifting goods from big vessels at the outer anchorage.

After holding a meeting daily, the company allocates empty ships to importers.

But since September to December last year, out of 120 days, meetings were not held in 78 days. The meetings that were held 35 days and the firm could not allocate lighter ships as per demand of the importers.

Out of 11 days this year, the firm could not allocate even a single lighter ship for eight days. 

Managing director of Premier Cement Amirul Haque said Tk 166 billion could be saved if sufficient lighter ships and jetty facilities could be ensured.

For example, he said, it takes 60 to 70 days to unload 50,000 tonnes of goods from a ship. But when there was no shortage of lighter ships, there was a record of unloading 16,000 to 17,000 tonnes of goods daily.

If 10,000 tonnes of goods are unloaded daily, it takes five days to unload 50,000 tonnes of commodities. The fare of 50 to 60 days from a ship could be saved. The foreign shipping companies need not to be compensated.

The businessmen based in Chittagong said the government staying in power straight nine years has not taken any step to solve the jetty crisis or to increase lighter ships. As a result, the importers have to incur loss for nothing. The money is being paid in compensation to foreign shipping companies while the consumers have to buy commodities at higher prices.      

*This report, originally published in Prothom Alo print edition, has been rewritten in English by Rabiul Islam and Imam Hossain