A Chattogram-Europe shipping route via Chennai is set to be launched by the middle of February, adding a new chapter to the country's sea-borne trade.
This will help slash shipping times for Bangladesh-made goods, people familiar with the development said. Higher lead time is considered a key constraint to conducting foreign trade smoothly.
Officials serving with international shipping firms said this is a great step towards expediting imports from India, the nation's second-largest trading partner.
But they feared that exporters might not show their interest in the route.
A senior executive at the Tradewind Logistics Limited, local agent of Hyderabad-based Vishwa Samudra Shipment Services Private Limited, told the FE, "Our first vessel is expected to reach by February 15 with industrial raw materials and other commodities from India."
He said the company has already obtained permission from the Chittagong Port Authority.
Vishwa Samudra is an Indian private feeder service company, which will connect Chittagong with Chennai-based Krishnapatnam Port, popularly known as KPCL.
The KPCL wants to promote the route to grab market shares from the Chattogram-Singapore-Colombo way.
He said Indian-made goods now take much time-in some cases six days-to reach the Chittagong port as it has to go to Colombo before sailing towards Bangladesh.
The executive said: "Local importers can save both time and money by using the new route." Currently, Chattogram-Colombo, Chattogram-Singapore and Chattogram-Port Klang lines connect Europe and America through shipping vessels.
Other rivals such as Hapag-Lloyd of Germany, Cosco Shipping of China, Yang Ming of Taiwan and Ocean Network Express of Japan had earlier showed interest in the new route.
Now they said that the main line operators and buyers will make the final decision as to whether they will use the new route or not. Shipping business needs two-way movement involving exports and imports to survive.
AS Chowdhury, country head of Singapore-based feeder service provider Seacon, said his company will not join the route for the time being.
Siddiqur Rahman, a former president of the Bangladesh Garment Manufacturers and Exporters Association, said buyers usually have the final say in deciding the route.
"Buyers instruct us which routes and which carriers will be chosen," said Mr Rahman, now a vice-president of the Federation of Bangladesh Chambers of Commerce and Industry, or FBCCI.
Mr Rahman said Singapore's infrastructure is much more efficient and it is recognised as a global hub for long.
KPCL is a privately-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 per cent owned by the Hyderabad-based CVR Group.
The London-based equity firm 3i Group Plc owns the remaining 8.0 per cent equity in KPCL. The KPCL wanted to launch the route in November 2019.