Bangladesh gives more, gets less

In providing transit to India, Bangladesh hardly benefits. It is India that rakes in all the gain, while Bangladesh will bear high costs in infrastructural development.

A consignment of goods was transported by road from West Bengal to Agartala in the first week of November 2015.  It was a test transit though land.

Had Bangladesh not allowed the transit, India would have to cross 1,560 kilometres from Kolkata to Agartala through Shiliguri, Assam, Meghalaya, and Karimganj. It could have required 192 hours. The latest consignment took around 51 hours to reach Agartala and distance of 559 kilometres. The distances have decreased by one thousand kilometres. India gave mere token tariff for the consignment.

Transit duty for the road route is yet to be fixed. Water transit duties were fixed at only Tk 192.22 in a meeting in New Delhi on Monday. Of the Tk 192.22, Bangladesh customs will get Tk 130, river port duties would be Tk 10, and transport charge would be Tk 1.02 per kilometre.

Bangladesh, India, Nepal and Bhutan would determine tariff for motor vehicle movement between the countries, which will be known as road transit.  

Given the water transit tariff, it can easily be assumed that duties for road transit would not amount to much.

Taking advantage of transit through Bangladesh, India now will be able to cut around 1000 kilometres of distance and 150 hours. Bangladesh deserves a part of the benefits India is getting.

But will Bangladesh be able to get what it rightfully deserves? Is it sufficient for Bangladesh to charge only Tk 192.2 duty to Indian vehicles?

Experts do not think so. They consider the transit duty insufficient and it is still not clear how much Bangladesh will have to invest in infrastructure.

Bangladesh Institute of Development Studies (BIDS) researcher Mohammad Yunus told Prothom Alo that Tk 192 for transporting goods per tonne is scanty. 

Bangladesh customs will have to recruit manpower and infrastructure so that it can differentiate and tag the goods entering the country.

Again, Bangladesh government has to spend a huge amount money every year for river dredging and building infrastructure to provide India water transit.

However in 2011, Bangladesh government formed a core committee on transit and transhipment that recommended 15 kinds of duty fees on transportation of goods.

The core committee recommended charging at least Tk 580 as duty for the National Board of Revenue (NBR). According to the committee, Bangladesh would have to invest Tk 47,000 crore to build infrastructure to provide India transit.

The core committee does not exist now and its recommendation also went into oblivion.

Former Tariff Commission chairman Mujibur Rahman told Prothom Alo on Tuesday that Bangladesh should have invested in infrastructure for providing India transit after assessing and analysing whether it will be able to recover the money it spends on infrastructure or not.