The first direct container MV Harbour-1 Vessel between India and Bangladesh carrying cotton was flagged off from Krishnapatnam of Andhra Pradesh to Chittagong on 28 March 2016.
The voyage was started as a part of a coastal shipping agreement to facilitate trade between India and Bangladesh.
The trade agreements were earlier signed during the reign of the then Indian Prime Minister Indira Gandhi in 1974 and they were revived back after a period of four decades during Prime Minister Narendra Modi's visit to Dhaka in June 2015.
Key Features of the Agreement
A standard operating procedure was signed between India and Bangladesh in November 2015 to move commercial cargo between the two countries. The provisions and procedures to be followed for such movement were also stated.
Many conditions were waived by both countries to facilitate easy bilateral trade. The vessels of both the countries upon entry in to India and Bangladesh shall be treated as domestic vessels and not foreign going vessels.
The provision will play a key role in addressing the traffic congestion at Petrapole (India) and Benapole (Bangladesh) the two border points which pose as one of the biggest impediments to the movement of EXIM cargo.
This will also offer to reduce the paper work required at the customs check points and port dues paid at Indian ports too will be at par with Indian vessels.
The vessel and cargo will also enjoy complete Protection and Indemnity (P&I) coverage insuring cargo from the point of loading to the final destination and till the time the parcel reaches the final consignee.
Both the countries agree to reduce customs documentation and other requirements to the essential minimum for the purpose of easier cargo movement and to have custom stations at or near the points of entry and exit in each country.
Trade between two countries
Earlier the shipments from Indian ports being transported to Bangladesh were routed either via Colombo or Singapore. With the launch of the direct service, time taken for such shipments would come down from 2-5 days.
The opening of the sea route will also enable the movement of cargo to the North Eastern states of India through coastal shipping up to Chittagong and thereafter by road or inland waterways. Secondly, the deep draft ports on the eastern coast of India can be hub ports for the onward transportation of cargo to Bangladesh through River Sea Vessels (RSV).
Exports and Imports
Cargo moving from India to Dhaka on road will take up to 30 days. The present voyage will be reduce the travel time and become an advantage.
India mainly exports raw cotton, cotton, steel, tyres and minerals, among others, which are valued at 6 billion dollars per annum to Bangladesh.
It imports goods like textile yarn, fish, mineral fuels, cement, bran and husk which worth half a billion US dollars.
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Who: MV Harbour-1 Vessel
When: 28 March 2016