Bangladesh : Preparing the South Asia Subregional Economic Cooperation Integrated Trade Facilitation Sector Development Program

Industry and trade / Industry and trade sector development

Transport / Multimodal logistics

The performance of Bangladesh in various global indices reflects improvements in the trade facilitation environment, but it also indicates that there is ample scope for further enhancement. The government formulated Export Policy 2015-2018 to promote and facilitate export, improve quality and has signed 29 bilateral Trade and Investment Cooperation agreements. The positive impact of the reform measures initiated to enhance organizational structure and modernize facilities is yet to be fully realized, as their implementation is constrained by insufficient use, infrastructural and capacity limitations, shortage of skilled human resources and impending introduction of new as well as complementary reforms. Effective implementation of the World Trade Organization Trade Facilitation Agreement (TFA) is another factor necessitating prioritization of customs reforms in Bangladesh. To comply with TFA and improve the environment of international trade, the government has identified 13 areas where they need external assistance and support for capacity building.

Modernization of customs and improvement of trade and transport infrastructure are essential in the current competitive trade environment. In the World Bank's logistics performance index, weakness is apparent in many areas of the global performance of Bangladesh. Its overall logistics performance index score in 2018 was 2.58 out of 5, and its country ranking is 100 out of 160 countries. Lack of coordination by government agencies has hindered development of border infrastructure and operations in response to growth of trade and transport demands.

Most of the existing customs offices, and cargo transshipment and storage facilities are underdeveloped, and their capacity is insufficient to handle international transit cargos. The last 2-5 kilometers (km) sections of roads to border crossing points are generally narrow and their pavement conditions are poor. Also, India and Nepal have demands of international trade by using the railways in Bangladesh. Bangladesh needs to build modernized land customs stations and land ports, and improve road conditions and railway cargo handling facilities at border crossing points.

An international consulting firm, David Lupton and Associates Limited in association with KS Consultants Limited was engaged to prepare (i) economic and financial feasibility study, (ii) engineering design and cost estimate, (iii) safeguard and gender documents, and (iv) procurement plan and bidding documents for the central customs facilities in Dhaka, and integrated trade facilities at the nine border crossing points (BCPs).

A video documentary with captions and narrations outline of the SASEC Integrated Trade Facilitation Sector Development Program was prepared. It presents status of the customs clearance and cargo transshipment operations and road traffic conditions at Akhaura, Sonamasjid, and Tamabil BCPs.