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After Ashok Leyland, it is now the turn of Tata Motors to use coastal shipping services to export trucks to Bangladesh.
India controls the commercial vehicles market in Bangladesh, with Tata Motors at the forefront.
The coastal shipping initiative will help the auto-maker bypass the congested land border route through Petrapole-Benapole and optimise market potential in Bangladesh.
A vessel carrying 240 trucks was flagged off by the Kolkata Port Trust (KoPT) Chairman, Vinit Kumar, from the Netaji Subhash dock. The vessel is expected to reach Mongla Port in Bangladesh in approximately two days.
In October, Ashok Leyland used shipping services for transporting 185 trucks from Chennai to Mongla.
While the initial shipping cost remains high, the charges are expected to reduce with an increase volume. The bigger savings would come through reduction in travel time.
In a recent report, BusinessLine identified that export consignments wait for two-to three weeks at the Petrapole border gates primarily due to capacity constraints of the Bangladeshi customs.
Trade facilities
A parallel study by Dhaka-based South Asian Network of Economic Modelling (SANEM) confirmed that trade facilities at Petrapole-Benapole border need capacity expansion to reduce trade costs.
Sources say, there is a demand for 3,000-3,500 trucks a month in Bangladesh, against which Tata Motors supplies about 2,000 a month, through the land route.
Tata Motors is trying to shore up its supplies in Bangladesh by sending approximately 1,000 vehicles a month through coastal shipping. A second consignment of 240 Tata trucks will be flagged off from the Kolkata port on November 27.
According to Kumar, using the coastal routes will result in both time and cost savings to users. The port authorities are in negotiations with automobile exporters to popularise the shipping route.
“We are in talks with Eicher Motors to promote the shipping route to cater to the Bangladesh market,” Kumar said.
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