India, Bangladesh to pilot freight train service in August

Posted by Daily Shipping Times on 17-07-2017        Tweet

KOLKATA: Come August, India and Bangladesh will run a container train on pilot basis between Dhaka and Kolkata to assess the feasibility of extending the services on commercial basis. Bangladesh is the ninth-largest importer of Indian goods.

According to sources in the Railways, a full rake of empty containers will go to Dhaka through the only broad-gauge connection through Gede(India)-Darshana(Bangladesh) border gates in West Bengal. Bangladesh will send the rake loaded with their export cargo.

A welcome move

The effort, if successful, may have a major cost impact on the $6-billion bilateral trade, which is currently dominated by non-containerised road cargo — mostly through the Petrapole border in West Bengal.

A 2010 BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) trade logistics study pointed out that rail movement can be 30 per cent cheaper than even sea-freight (which is normally considered the cheapest) between the two neighbours.

As the trade is heavily tilted in favour of India, the road movement eats into the competitiveness of Indian exports ($5.4 billion). Loading and unloading of non-containerised road cargo at the border further makes the trade costly and unsafe.

Direct movement of containerised cargo by train may, therefore, reduce trade costs significantly. Also, containerisation will make the trade more organised and safer.