Ctg-Chennai-Europe shipping route opens in Nov

FT ONLINE

A new strategic Chattogram-Chennai-Europe shipping route is likely to commence next month which is expected to reduce lead time.

Currently, Chattogram-Colombo, Chattogram-Singapore and Chattogram-Port Klang lines connect Europe and America through shipping vessels.

The external traders of Bangladesh are very familiar with these routes for export-import business.

As proposed, domestic goods will reach the Chennai-based Krishnapatnam Port, popularly known as KPCL, and load them onto mother vessels meant for central Europe.

The private KPCL deep seaport has been promoting the route as the country's external trade has been riding high on the back of higher export and import.

Once the route gets going, lead time meant for the European market is due to drop at least two days which may boost shipment, people in shipping circles said.

Apart from this, imports from India, the second-biggest trade partner of Bangladesh, may quicken as well.

To this end, a KPCL team, led by director Ms. Vinita Venkatesh, visited Dhaka and Chattogram weeks ago.

KPCL is luring the mainline operators by making them offer like 100-day free time of containers.

Shipping lines Hapag-Lloyd of Germany, Cosco Shipping of China, Yang Ming of Taiwan and Ocean Network Express of Japan have already shown interest in the new route.

Shipping executives having knowledge of the development shared this to the FT team.

The four shipping companies have roughly an aggregate 20-percent stake in the county's container trade, according to people in the shipping circle.

On the other hand, multiple shipping lines have adopted a 'wait-and-see' policy to find actually what happens in the coming months on the route.

Sahed Sarwar, deputy managing director at the Singapore-based Feedertech, said they had met with the KPCL representatives recently.

"We're yet to decide, rather we're going to have (to) wait and see what happens on the route," he said.

Captain AS Chowdhury, country head of another Singapore-based feeder service provider Seacon, said they would observe and then make a decision.

"We're thinking positively… But not now," he said. But exporters said they have little command of the route choice as buyers decide it.

Siddiqur Rahman, a former president of the apex clothing body Bangladesh Garment Manufacturers and Exporters Association, said buyers usually decide a route for use.

"Buyers instruct us which routes and which carriers will be chosen," added Mr. Rahman, now a vice-president at the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI). The business leader, however, said Singapore's infrastructure is much more efficient. "Does KPCL have so efficiency to handle our cargoes?"

KPCL is the is a privately built and owned all-weather, deep-water port on the east coast of India, located in the Nellore district of Andhra Pradesh.

It is located about 190 kilometres north of Chennai Port and 18 kilometres east of the city of Nellore.

The port is owned and operated by KPCL which is 92 percent owned by the Hyderabad-based CVR Group.

The London-based equity firm 3i Group Plc owns the remaining 8.0 percent equity in KPCL.