For the first time in 39 years, the Chittagong Port Authority has increased tariffs by up to 50 per cent.
The new tariffs came into effect in the early hours of Tuesday.
Businessmen warned that the increased port service charges would raise trading costs and affect business competitiveness. The increased tariffs will increase consumer prices.
Some of the port charges have increased more than others. For instance, the berthing charge for the first 12 hours has been increased by 100%. After 36 hours, the berthing charge has been increased by up to 900%.
The new tariff sets the pilotage fee at $800 per movement, while the new fees for tugboat services range between $ 615 and $ 6,830, depending on vessel size.
Container handling and other services' charges have seen a 25% to 50% increase.
"The scope and capacity of the port are expanding. We are committed to building new facilities and ensuring smooth services for port users. We do not believe this tariff adjustment will significantly impact consumers," said Omar Faruk, the CPA secretary.
Syed Mohammad Arif, chairman of the Bangladesh Shipping Agents Association, said the new tariffs will hurt trade.
"We had requested a maximum increase of 10-12%" he said.
However, port officials estimated the per-kilogram impact of the increased tariff to be marginal, increasing costs by 32 to 44 paisa.
The Chattogram port handles about 33 lakh containers and 13 crore tonnes of cargo annually, with over 4,000 ships using the port service each year.
The new tariff structure was built on the advice of the Spain-based consultancy firm IDOM, which compared tariffs of 17 major global ports, including 10 Asian ports, before coming up with its recommendations.
Export-bound containers, both full container load and less-than-container-load, now get 6 days of free time instead of the earlier four days' time. The port will start charging from the 7th day at the daily rate of $ 6.90. The charge will rise with time, reaching $ 62 a day after 21 days.
Issuing a warning that the revised tariffs could pose serious challenges, SM Saiful Alam, president of the Chittagong Customs Agents Association, said, "Where will traders recover these new costs from? Ultimately, it will be passed on to consumers. This is a bad development for the economy."
He pointed out that Chittagong port still lacks modern equipment, even compared with the ports in the neighbouring countries.
Currently, the port has only 18 gantry cranes, while 12 other berths rely on ship cranes to handle cargo.
Shafiqul Alam Jewel, vice chairman of the BSAA, demanded that the port authority ensure better service after the tariff increase.
According to the gazette, the entry fee per gross ton now stands at $ 0.306, while the vessel working charge within the port was set at $ 0.017.
The minimum pilotage charge was fixed at $ 800. Vessels over 10,000 GT will have to pay $ 0.08 per gross ton.
The night navigation surcharge has been increased by 25%, while the outer pilotage area surcharge has increased by 50%. The tugboat fee per movement for 200-5,000 GT was set at $ 615.
The water supply charge from the mainline has been fixed at $ 2.92 per 1,000 litres. The cost of supplying water by a port lorry travelling a distance of 5 km has been fixed at $ 6.23. Using a water boat for water supply in the Karnaphuli River will cost $ 12.46.
The boat water supply cost beyond 7 nautical miles from the Patenga lighthouse will be $ 24.96 per 1,000 litres. The waste handling cost within the Karnaphuli is now $ 2,456.99. Outside the Karnaphuli, the waste handling cost will be $ 4,063.15. The crane use charge per container for a crane less than 21 feet has been fixed at $ 20.80. For using a crane over 40 feet, now traders will have to pay $ 35.10.
This is the first time since 1986 that the CPA announced new tariffs.
Port authorities say the tariff review was necessary to improve services and fund infrastructure upgrades to meet global standards.
With around 80% of the country's apparel exports going through Chittagong port, business leaders said the increased costs could affect competitiveness.
Rakibul Alam Chowdhury, a director of the Bangladesh Garment Manufacturers and Exporters Association, said, "The industry was struggling to cope with the US-imposed 20% tariff. The new charges will complicate the situation further."
Mahfuzul Haque Shah, a former director of the Chittagong Chamber of Commerce and Industry, said that such a steep rise in cost is very difficult to deal with.
"Our request to stand by businessmen in this difficult time was not heeded," he said.
"It will raise the costs of imported consumer goods and raw materials, impact manufacturing and hurt the economy," he said.
Chittagong Port is currently ranked 68th among the world's top 100 busiest ports and handles 93% of Bangladesh's total import-export trade.
Comments