India and Bangladesh signed a standard operating procedure (SOP) in New Delhi on November 15 to operationalise the Agreement on Coastal Shipping that the two countries entered into in June, 2015, according to an official statement. The agreement is likely to increase bilateral trade, including textile and apparel trade given that Bangladesh is a major importer of Indian cotton. Shipping and Road Transport and Highways Minister Nitin Gadkari who attended the signing ceremony said the SOP will pave the way to promote coastal shipping between India and Bangladesh and enhance bilateral trade between the two countries by bringing down the cost of transportation of Exim cargo. The SOP contains provisions which stipulate that India and Bangladesh shall render same treatment to the other country’s vessels as it would have done to its national vessels used in international sea transportation. The two sides have also agreed upon the use of vessels of River Sea Vessel category for Indo-Bangladesh coastal shipping. India and Bangladesh have a Bilateral Protocol on Inland Water Transit and Trade (PIWTT) for operation of inland vessels on the river protocol routes between river ports of Haldia, Kolkata, Pandu, Karimganj and Silghat in India and Narayanganj, Khulna, Mongla, Sirajganj and Ashuganj in Bangladesh. This protocol between the two countries has facilitated the movement of Exim trade as well as cargo bound for the North Eastern states of India. Out of a total of 1.8 million tonnes of cargo moved on Indo-Bangladesh protocol route during 2013-14, about 98 per cent is fly ash which is transported from Kolkata to various river ports in Bangladesh. During the current financial year, India for the first time is using the Indo-Bangladesh river protocol to transport food grains via Ashuganj to Tripura. However, the quantum of cargo has not picked up because of low draft in the upper reaches of Bangladesh rivers and also because of certain non-trade barriers. The present connectivity through sea route with Bangladesh is through ports of Colombo and Singapore. The long sea route adds significantly to the transportation costs of Exim trade. There is no significant cargo movement between sea ports of Bangladesh and India as it is not profitable for the big vessels to operate between these sea ports. Under such circumstances, there is a need for smaller ships to provide direct connectivity between the eastern sea ports of India, Chittagong and other ports in Bangladesh. This, besides improving the connectivity would also provide competitive freight rates, the statement said.
