Bangladesh seeks to boost air cargo capacity after India ends transshipment

Highlights:

• India revoked Bangladeshi export transit, prompting urgent air cargo expansion plans
• Sylhet airport begins cargo operations; Dhaka and Chattogram upgrades underway
• India cited "incidents" for decision; no specific details were provided
• Exporters see infrastructure boost opportunity despite logistical disruptions
• Dhaka's new terminal to boost cargo capacity tenfold by year-end

Following India's decision to revoke the transshipment facility for Bangladeshi exports, the interim government is accelerating efforts to strengthen independent air cargo operations and sustain export momentum.

The Civil Aviation Authority of Bangladesh (CAAB) has stepped up plans to expand cargo capacity, including introducing dedicated cargo flights from Sylhet's Osmani International Airport and bolstering manpower at Dhaka's Hazrat Shahjalal International Airport.

The move comes after India's Central Board of Indirect Taxes and Customs withdrew a provision on 8 April that allowed Bangladeshi exports to transit through Indian land ports en route to international airports and seaports.

CAAB Chairman Air-Vice Marshal Md Monjur Kabir Bhuiyan told The Business Standard that additional staff will be deployed at Dhaka airport until the third terminal becomes fully operational in October.

"We're expediting cargo clearance at Shahjalal airport," he said. "Sylhet airport will launch cargo operations on 27 April, and we're fast-tracking plans for Chattogram airport. Discussions are also ongoing with foreign airlines, like Turkish Airlines, to increase cargo flights."

Hafiz Ahmed, director of Sylhet Airport, confirmed that Voyager Airlines will operate the first cargo flight to Spain via the Middle East, carrying 60 tonnes of garments. "Despite being cleared in 2022, cargo operations never took off – until now," he added.

India cites "incidents" for policy shift

At a briefing, India's External Affairs Ministry spokesperson Randhir Jaiswal attributed the cancellation to "certain incidents" but offered no specifics.

While the move poses logistical hurdles, industry leaders see an opportunity for Bangladesh to upgrade its cargo infrastructure.

Mohammad Hatem, president of BKMEA, said exports won't be severely affected, as alternatives like sea-to-air shipments exist. "If Sylhet airport becomes viable, we can shift exports there," he noted.

Hatem urged the government to reduce costs, while BAFFA President Kabir Ahmed stressed coordination between CAAB, Biman, and freight forwarders. He proposed exploring UAE, Sri Lanka, and Maldives routes for competitive rates.

BIDA Executive Chairman Chowdhury Ashik Mahmud bin Harun called the shift a "new door" for utilizing airports in Sylhet, Chattogram, Saidpur, and Lalmonirhat. "We must enhance our capacity – it's our only option," he said.

Third terminal to boost capacity

Currently, eight cargo airlines operate via Dhaka, including Emirates, Qatar, and Turkish. The third terminal, set for full operation by year-end, is expected to increase cargo capacity tenfold with automation.

CAAB's Monjur Kabir said the timeline depends on finalizing a contract with a Japanese consortium. "If signed within a month, operations can start in six months," he added.