Logistics development policy needed to improve transport system
A comprehensive national logistics development policy is needed to enhance the local transport system and facilitate foreign investment, according to speakers at the International Investment Summit 2021.
"Streamlining the national logistics development mechanism is mandatory for developing countries to increase private investment," said Abul Kasem Khan, chairperson of the Business Initiative Leading Development (BUILD).
Both local and foreign companies demand efficient logistics support to ensure improved productivity, shorter lead-time, and facilitate expansion as per market needs.
"And considering Bangladesh's growth projections, a world-class logistics ecosystem is required to improve the country's overall competitiveness," he added.
Khan made these comments while delivering the keynote in a session on "Transport and Logistics: The Right Move" at the Radisson Blu Dhaka Water Garden yesterday.
The two-day International Investment Summit, organised by the Bangladesh Investment Development Authority (Bida) under the sponsorship of International Finance Corporation (IFC), began on Sunday.
"We estimate that an injection of $300 billion is needed for infrastructure development until 2031, when investment in the sector will reach 6 or 7 per cent of the gross domestic product (GDP) from the 3.6 per cent at present," Khan said.
The cost of connectivity in Bangladesh is high due to inefficiencies in the sector, such as extreme traffic and port congestion.
Besides, the country's consistent GDP, trade and industrial growth has overburdened its transport ecosystem, he added.
State Minister for Shipping Khalid Mahmud Chowdhury said the government has taken necessary initiatives to develop port facilities and facilitate economic growth.
"This logistics support from the government will help enhance port efficiency and meet the growing demand for warehouses," he added.
M Shahjahan, chairman of the Chittagong Port Authority, said they have taken a number of steps to increase the seaport's container and cargo handling capacity to meet the growing demand for such services.
Besides, new ports are being established while existing facilities are being upgraded, such as the new jetty and channel dredging at Chittagong port.
"But we need to invest in equipment to ensure global standard facilities at the Matarbari and Payra ports," he added.
Wan Chee Foong, regional chief executive officer for the Middle East and South Asia at PSA International Pte Ltd, said Bangladesh needs to establish easy global connections as its economy is growing rapidly.
"So, regulatory support is essential to develop the local logistics sector as it would help the country grow its international trade volume," he added.
Md Abul Bashar, director general of the Public Private Partnership (PPP) Authority, said the organisation is ready to facilitate foreign investment in all sectors, including power and healthcare, under joint ventures with local companies.
Bashar went on to say that financial investment is not the only element under the PPP model as technological and expert support is also needed.
Syed Ershad Ahmed, president of the American Chamber of Commerce in Bangladesh, said the local logistics sector is very poor and requires special attention to handle the growing demand for import-export facilities.
Citing that the warehouse at the Hazrat Shahjalal International Airport is not sufficient considering current needs, Ahmed suggested expanding such facilities to expedite export.
Naquib Khan, president of the Bangladesh Supply Chain Management Society, moderated the session where Mahbubul Alam, president of the Chittagong Chamber of Commerce and Industry, also spoke.