The government has withdrawn fixed freight rates on the Chittagong-Pangaon-Chittagong route to boost container transport by waterways and ease pressure on congested highways and railways.

The Chittagong Port Authority (CPA) issued a notification last week stating that freight rates will now be set through bilateral agreements between vessel owners and mainline operators without government intervention.

The decision follows longstanding demands from importers and exporters, who found the previously fixed rates too high, discouraging them from using the Pangaon Inland Container Terminal (ICT) in Dhaka.

To address logistical challenges, the Bangladesh Railway has struggled to provide enough locomotives to transport containers between Chittagong and Kamalapur ICD. As a result, nearly 1,700 TEUs of containers are currently stranded at Chittagong Port, delaying shipments for Dhaka-based importers.

In response, the National Board of Revenue (NBR) has allowed containers destined for Dhaka ICD to be transported via Pangaon for clearance under specific conditions for the next two years.

The move is expected to cut costs and save time for importers. Industry leaders, including Bangladesh Shipping Agents’ Association (BSAA) Chairman Syed Mohammad Arif, welcomed the decision, citing increased competition and more flexible pricing for shippers.

Pangaon ICT’s container handling dropped sharply in FY 2023-24, highlighting the urgency of reforms to enhance its efficiency.