Why direct shipping is the next frontier of Bangladesh’s trade competitiveness

The Bay of Bengal is no longer simply our strategic frontier; it now lies at the heart of Bangladesh's future prosperity. At this critical juncture, the priority is clear: logistics competitiveness must become a national focus. Without it, speed to market will continue to lag behind that of peer competitors, weakening our position in attracting foreign direct investment and developing manufacturing hubs.

For many years, this anchor has not held firm. For decades, the lifeblood of our economy—from ready-made garments that sustain our exports to the industrial raw materials that keep factories operating—has been forced along an indirect route. Shipments have passed through Colombo, Singapore, or Port Klang before finally reaching their destinations. This circuitous flow is more than a logistical inconvenience; it represents a deep structural bottleneck that costs the nation billions and weakens our competitiveness.

At the Chittagong Port Authority, 2025 marked a defining moment. We handled a record 3.41 million TEUs of containers and 138.15 million tonnes of cargo, raising revenue to Tk5,460 crore and contributing Tk1,804 crore to the national treasury. We also achieved new benchmarks across all key performance indicators, many of which once seemed unattainable, as vessel waiting time fell to zero in the final quarter of the year. 

These results demonstrate strong operational capability, but they form only the groundwork for a much larger shift. The central question is no longer how much we process, but how we manage it. The answer lies in a determined and uncompromising move towards direct shipping.

The inefficiency becomes clear when viewed in simple terms. At present, most of Bangladesh's maritime trade moves through regional transshipment hubs. Each export container—whether it carries garments, leather goods, or jute products—incurs additional costs, undergoes extra handling, and loses valuable time. A direct shipment from Chittagong to a port in Europe or East Asia typically takes 15 to 25 days; when transshipment is involved, the same journey extends to 40 to 45 days. This delay acts as a constant drag on the country's export performance.

This reliance also imposes what may be described as a "transshipment tax." Bangladeshi goods do not enter global markets on equal terms. Exporters from countries with direct shipping links can reach buyers in about two weeks, while ours take roughly twice as long. This persistent delay places our producers at a clear disadvantage. The financial burden of this inefficiency is evident in national figures: Bangladesh's logistics costs stand at an estimated 15 to 20% of GDP, far above the global average of 8 to 10%. A large share of this gap stems directly from the additional distance, time, and cost created by transshipment.

Time is the most valuable commodity in global trade. Recent volatility—from the Strait of Hormuz crisis to wider geopolitical shocks—has made it clear that reliable schedules now carry the weight of currency. When India discontinued transshipment facilities in April 2025, it triggered immediate concern, but it also pushed the market towards a practical solution. The launch of direct Karachi–Chittagong services that followed reduced delivery times from 23 days to just 10 days and brought down costs in a meaningful way. This example demonstrates, in concrete terms, what direct connectivity can deliver.

The scale of the opportunity is considerable. The economy is expected to expand, with the Asian Development Bank forecasting 5% GDP growth for FY2026. As imports continue to rise—reaching $33.67 billion in the first half of FY2026 alone—the volume of goods moving through our ports will increase further. Without direct shipping, this growing flow will continue to pass through an already congested and expensive system.

Direct shipping marks a strategic inflection point in Bangladesh's maritime evolution. It has the potential to recast our ports from passive endpoints into active gateways of global commerce. But such a transformation will not emerge from infrastructure alone; it demands a deliberate and far-reaching structural shift.

We must prepare for a different scale of shipping altogether. Larger vessels, greater carrying capacity, and deeper drafts are no longer optional; they are the entry requirements for relevance in modern maritime trade. Without the ability to accommodate mother vessels and sustain round-the-clock operations, direct connectivity will remain constrained, both in reach and impact.

At the same time, our ports must open themselves fully to the sea. Physical and navigational limitations that once seemed manageable now act as silent barriers, slowing movement and raising costs. Removing these constraints is essential if we are to align with the rhythm of global shipping networks.

Beyond the shoreline, the transformation must extend inland and outward. We need logistics nodes that function as a connected system rather than isolated points, linking ports with highways, rail corridors, industrial clusters, and global supply chains. Efficiency today is not defined by a single port's performance, but by the seamless flow across an entire network.

Direct shipping marks a strategic inflection point in Bangladesh's maritime evolution. It has the potential to recast our ports from passive endpoints into active gateways of global commerce. But such a transformation will not emerge from infrastructure alone; it demands a deliberate and far-reaching structural shift.

Partnerships will be equally decisive. Direct shipping cannot be sustained in isolation. It relies on deep collaboration with local, regional, and global logistics providers and buyers. It is built on reliability, shared standards, and consistent volume flows. Trust, once established, becomes the currency that anchors long-term shipping commitments.

Finally, the logic of what we export must evolve alongside how we export it. A logistics system designed for speed and precision must serve an economy that produces higher-value goods. We must move steadily beyond traditional exports towards more sophisticated, high-end products, where time, reliability, and quality translate directly into competitive advantage and stronger returns.

The benefits of direct shipping extend across multiple dimensions. First, it would strengthen our exports. The apparel sector, valued at more than $50 billion and central to the economy, would benefit from faster and more predictable delivery to buyers in Europe and the United States. Second, it would help attract foreign investment. Global manufacturers depend on just-in-time logistics, and without it, they often choose other destinations. A direct link to Europe and Japan—a proposal I presented at the 2025 IAPH World Ports Conference in Kobe—represents more than a shipping route; it offers a direct connection to high-value markets for apparel, leather, and light engineering goods. A direct Chittagong–Hamburg service, supported by German trade promotion mechanisms, could bring greater stability to schedules and reduce reliance on uncertain transshipment hubs.

Finally, direct shipping supports our environmental objectives. A single direct voyage produces significantly lower carbon emissions per container than a journey that relies on multiple transshipment stages. As the global economy moves towards net zero, a lower-carbon logistics chain will become an essential requirement for the competitiveness of our exports.

This transformation is already under way. Our major strategic projects—the Matarbari Deep Sea Port and the Bay Terminal—are being shaped with this direct future in mind. Matarbari, with its 18.5-metre natural draft, will be able to accommodate large, fuel-efficient mother vessels that define modern shipping. We have secured a $650 million World Bank loan for the Green Port of Bay Terminal, and construction is about to begin.

But infrastructure alone cannot deliver results. Without connectivity, it risks becoming a symbol of lost opportunity. We must move with determination to make direct routes commercially viable. This requires collaboration with Western and Eastern authorities to align customs procedures, logistics systems, and reefer schedules. It also calls for pilot voyages with anchor shippers to demonstrate reliability and attract a wider group of carriers.

The moment for gradual steps has passed. Bangladesh cannot remain a passive follower of global shipping schedules. By securing direct shipping, our trade will gain speed-to-market advantages over peer competitors. We will be able to lower logistics costs, shorten delivery times, and reduce our carbon footprint. We will turn the Bay of Bengal from a transit space into a starting point for national prosperity. At Chittagong Port, we have shown that we can surpass our own records. The next step is to move beyond established patterns. The journey will take time, but the goal is clear: Bangladesh must trade on its own terms, with the world within immediate reach.

Sketch: TBS

Rear Admiral S M Moniruzzaman is the Chairman of the Chittagong Port Authority.

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.