Dhaka could reap $2.3 bn from transit facilities to India, others

To earn that profit, Bangladesh would, however, have to invest $1.17 billion in capital expenditure, operation and maintenance costs for over 30 years to develop corridors for transit traffic, says the Centre for Policy Dialogue (CPD).

Of the amount, $53.74 million and $769 million would be required to set up road and rail links, $79 million and $129 million to upgrade the Chittagong and Mongla ports, and $99 million to operate and maintain them.

Bangladesh and India signed a joint communiqué in January 2010 creating scope for introducing multi-modal transit and transhipment between the two nations. After years of nursing reservations that India could gain at its expense, Bangladesh is now preparing the UN-sponsored trans-Asian road and rail network that will link major points in the region.

Prime Minister Sheikh Hasina's pacts with India that allow the trans-Asian linkages have, however, been opposed by the main opposition Bangladesh Nationalist Party. The CPD study says the transit revenue for Bangladesh would be low in the first five years since many constructions and arrangements would be done during the period. Bangladesh would be able to reap about 10 percent of the full potential benefit at that time.

"From the sixth year onward, full potential benefits are assumed to be realised," the Daily Star said Sunday. A team of experts from Bangladesh, India, Nepal and Bhutan prepared the study report. Rahmatullah, former director of the UN Economic and Social Commission for Asia and the Pacific, led the team.

Bangladesh could gain at least three benefits from transit services, says the study. Freight charges within Bangladesh's transport network would go down and the country would receive revenue in port charges from international cargo at the Chittagong and Mongla ports. Besides, transit fees to be earned by Bangladesh will be equivalent to 70 percent of India's transport cost saving, it says.

The study covered 14 corridors - eight road routes, five rail routes and a waterway - for transit traffic between Bhutan, India and Nepal through Bangladesh.

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