Bangladesh makes e-seal and lock mandatory for goods in transit from India

Bangladesh will use the electronic seal and lock that is mandatory for transit and transshipment of goods from India to ensure complete security during transit between countries.

Under the Chattogram and Mongla Ports Agreement (ACMP) signed in 2018, neighboring India has completed four shipments of goods in transit under the Standard Operating Procedure (SOP).

Customs officials now said the National Board of Revenue (NBR) is working to issue a permanent order under which goods in transit could be moved from India to Bangladesh under the agreement.

According to the Electronic Seal and Lock Service Rule-2018, the government may charge fees for shipping goods in transit.

A senior NBR official said the rules would be changed and the deployment of e-trackers would begin in line with corporate demand.

Currently, the rule is optional for all companies, but it could become mandatory for transporting goods in transit, he said.

However, customs could not implement the regulations for four pilot shipments of goods in transit because the government was unable to designate a company to supply electronic locks and seals under the NBR Statutory Regulations Ordinance (SRO).

On June 26, the National Revenue Agency issued the rules, titled “Electronic Seal and Lock Service Rules 2018,” effective immediately.

Instead of electronic lock and seal, the customs wing had to use a manual lock (sailing gala) and employ one or more escort officers to complete the trial run of goods in transit.

Customs officials said the use of electronic seals and locks can minimize the risk of goods moving in transit.

The International Customs Trade and Agreements Wing of NBR recently suggested that the high authorities take immediate action to amend and implement the rules on electronic seals and locks.

India-Bangladesh Chamber of Commerce and Industry President Matlub Ahmad said the use of electronic seals and locks would be welcomed by all if the government could offer a subsidized price for the service.

“The cost of hiring electronic lock and seal services is typically too high, which is why it has been shelved for years. It should be affordable like (a) normal seal and lock to facilitate business,” he said.

It’s a tracker, nothing else, but it’s very useful and should be implemented immediately, he added.

The electronic lock could also be used domestically to check for theft in case of apparel goods export process, he added.

The on-carriages of transit goods ended in October 2022. According to the agreement, the approved routes are Port of Chattogram-Mongla to Agartala via Akhaura, Port of Chattogram-Mongla to Dawki via Tamabil, Port of Chattogram-Mongla to Sutarkandi via Sheola and the Chattogram-Mongla Port to Srimantapur via Bibirbazar and vice versa.

During a visit by Prime Minister Sheikh Hasina of Bangladesh to India in 2019, an SOP to operationalize cargo transit was signed. The neighboring country signed the agreement to reduce both the cost and time of transporting goods to the north-eastern states of India.

On the Bangladeshi side, the deal would help logistics, insurance, transportation and the financial sector to generate revenue. Under the terms of the agreement, traders would only have to use trucks from Bangladesh to handle goods.

Syed Hasan Tarique, a logistics expert and member of the American Chamber of Commerce and Industry (Amcham), said the electronic seal and lock could be enforced as an optional measure now that such a tracking option exists.

The NBR has mandated e-tracking technology for the movement of export-import cargo from port to private inland container depots (ICDs), also known as off-docks, and vice versa.

Previously, various trade associations and major business groups had opposed the measure, saying it would drive up the cost of doing business.

These include the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), Metropolitan Chamber of Commerce and Industry (MCCI), Chittagong Chamber of Commerce and Industry (CCCI), Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Port Users Forum (PUF ), and Chittagong Customs Clearing and Forwarding Agents Association (CCCFAA), etc.

They urged NBR to scrap the rules and not continue. According to the rules, the exporters and importers are required to pay 600 Tk for each container or covered van or truck going from the private ICDs to Chittagong Port and from the port to the ICDs in the first 48 hours.

However, you have to pay 50 Tk for the service for each of the next hours. Businesses found it to be a costly and time-consuming technology that can cause delays in shipping goods and also increase port congestion.

Last year, fierce business opposition forced the government to cancel at least three inauguration programs for the launch of the electronic lock and seal system at Chittagong Port.

The companies believe that the e-tracking system is not necessary for the port’s exporters, importers and other stakeholders.

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