20th Anniversary Suppliments Archive

Transit and connectivity: Regional approach

Dr. Mohammad Mohiuddin Abdullah

South Asia inherited an integrated transport infrastructure from the British. This was fractured not only by the partition of India but by its political aftermath. The transport network still continue to remain fragmented due to various historical, political and economic reasons which needs to be rebuilt within the context of greater political harmony in South Asia. The transport system of the main land countries of South Asia has developed only in a national context with little consideration given to cross border issues of compatibility, uniformity of standards in infrastructure and equipment design. It is felt that for socio-economic development if South Asia's intra-regional trade is to grow rapidly, among others, this will require integration of the transport infrastructure of the region. This calls for cooperation in the strengthening of transportation, transit and connectivity across the region, including harmonization of standards and simplification of customs procedures and other similar trade facilitation initiatives to minimize the non-physical trade barriers in support of investment in the transport infrastructure.

Transport cost is a significant determinant of competitiveness, making an integrated and efficient transport networks an essential element of the enabling environment for economic integration at any level. The provision of physical infrastructure in the form of an integrated transport network is essential, but not a major condition in itself for efficient and effective international movement. It is necessary to have adequate facilitation measures to address all the non-physical barriers so that goods, vehicles and people can move freely across international borders.

Export by one country to third country using the space of another country can be termed as transit. On the other, transportation of goods from the part of one country to another part of the same country using another country is known as corridor facility/connectivity. As for example export by India, Nepal or Bhutan to any third country using Bangladesh territory is transit whereas transportation of goods from one part of India to another using Bangladesh space can be termed as corridor facility/connectivity.

Objections are greater against corridors than transits, as the latter involves other countries as well. Corridor facility in the name of connectivity can be established through bilateral agreement between two countries but to establish transit facilities three countries are to be agreed. Bangladesh signed transit treaties with Nepal in 1976 and with Bhutan in 1980 but to operate transit facilities agreement should be made with India because Indian territory to be used to implement transit facilities between Nepal-Bangladesh and Bhutan-Bangladesh. But Bangladesh does not have any treaty with India regarding transit or corridor. Due to lack of any treaty, trade between said two countries is presently carried out by transshipment or by transporting goods from the cargo of one country to the cargo of another.

The decision of Islamabad SAARC submit in January, 2004 impressed everyone, as it committed itself to intensify cooperation in a number of areas including strengthening transport, transit and communication links/connectivity across the region. Recognizing the importance of transport integration in South Asia, SAARC initiated the SAARC Regional Multimodal Transport Study (SRMTS) with the main objective of enhancing multi-modal transport connectivity among SAARC member states , so as to promote intra-regional trade.

The SRMTS indicates as to how a selection was made of the major corridors and gateways of regional significance in the different modes of transport-road, rail, inland waterways, maritime and aviation for in-depth analysis and identification of their physical and non-physical barriers, including any institutional weaknesses obstructing the efficient movement of freight traffic. Based on further analysis of information concerning physical and non-physical barriers, together with measures to address the barriers, a road map has been proposed in the report which was considered by the SAARC submit held in Delhi.

The road map includes some recommended selected priority measures needed to address the most critical, in order to promote efficient and fully integrated multi-modal transport connectivity among SAARC countries. The priority measures has yet been implemented by member countries but without implementing physical and non-physical barriers India is interested to have connectivity agreement with Bangladesh for transportation of goods to other part of India i.e. Northeast India.

Photo: AFP

Bangladesh has a unique geographical location with two land locked countries (Nepal & Bhutan). We are fortunate to have two sea ports (Chittagong & Mongla) and potential for developing a deep sea port. Nepal and Bhutan even Chaina have showed their interest to use our sea ports. If regional transit or connectivity is provided by Bangladesh to these hinterland countries and territories including access to its sea ports, tremendous opportunities could have opened up for Bangladesh to trade in transport connectivity.

Trading in transport connectivity with neighboring countries could reduce trade deficit. It is crucial to understand clearly that these transport connectivity will have no market elsewhere outside this sub-region and that these opportunities of trading in transport services may not continue long. It is also important for the sub-regional countries to recognize that no country other than Bangladesh can provide these transport connectivity and services.

Bangladesh could emerge as a transport hub for the sub-region comprising Bangladesh, Bhutan, Nepal, India if it opens up its transport system to provide regional connectivity. Transport connectivity with India only could not create a win-win a situation for all countries involved i.e. Nepal and Bhutan.

Goods that come to Bangladesh from Nepal or Bhutan by road have to travel through Indian territories. Exporters from Nepal and Bhutan have to face several challenges in terms in terms of pre-designated time for shipment, customs related complications and changing transport at different border areas. This way, the transportation of goods had become an obstacle for both exporters and importers. As there is no tripartite treaty regarding transit for goods transportation between Bangladesh-India-Bhutan and Bangladesh-India-Nepal the trade bottleneck never resolved.

So there should be a balanced view based on objectivity and pragmatism. We should have thorough reading of the geo-social realities and economic expediency in the context of global recession. We should take a note of recent global economic strategies. Some advocated a new trade term with India bringing transit into the bilateral dialogue. The eyes of the people are set on how things move onwards realizing the vibes around civil societies on 250 miles corridors in the name of transit/connectivity. Recently a good number of projects have been approved ECNEC with the financial assistance of India which are connectivity in nature.

Before finalizing transit/ connectivity with India, our government should finalize the tripartite treaty with Bangladesh-India-Nepal and Bhutan.

There is no authentic estimate of the possible benefits that each of the four countries (Bangladesh, Nepal, Bhutan and north-east India) will get if regional connectivity/transit are opened up. Transit may be on the issue of bilateral trade with India and Nepal. There is no need thinking about transit so early going faster with the working on modalities. In fact gravity of Indian concern about using Bangladesh land and waterways to facilitate inland trade with the north-east is more apparent than real. Transit/Connectivity and terms of trade are so complicated that it is not wise to give a value judgment at this moment.

It may be mentioned that the Asian Highway (AH) and the Trans Asian Railway (TAR) projects of UNESCAP have identified the major road and rail links among the countries of South-Asia. The SRMTS also identified a number of routes in road, rail, IWT and aviation which could provide efficient regional connectivity. Bangladesh has signed TAR and agreed to implement the recommendation of SRMTS. To implement TAR, SRMTS recommendations and also AH a technical committee may be formed to do the feasibility study in terms of available road and other infrastructures, markets, ports, safety nets against trafficking of arms and undue infiltration of regional/sub-regional specially Indian goods to the detriment of local markets and tight security measures against terrorism with check post at strategic points. Bilateral agreement (between India and Bangladesh) will not serve the interest of AH, TAR and SMRTS.

The transit/connectivity among South Asian countries should be conceived within the framework of regional economic integration, where all natural and environmental resources, facilities and opportunities should be exploited for the benefit of all countries in the region/sub-region. Before signing connectivity agreement between India and Bangladesh a detailed feasibility study should be conducted and the issues like water sharing, maritime border, lopsided trade, cable TV, disputes in border areas, decision of Indian government in respect of accessing of Nepal and Bhutan's third country trade to Bangladesh Ports (this traffic will transit through India), customs, security of vehicle movement etc. to be addressed.

To establish effective regional transport connectivity/transit, political commitment is a must and the present governments of SAARC countries should take the opportunity to resolve all their outstanding issues through mutual consultation.

The writer is Joint Chief (PRL.), Planning Commission.