In Bangladesh's congested highways, overloaded trucks crawl through gridlocked roads while just nearby, fleets of barges glide along calm inland waterways – transporting containers to their destinations at lower costs and with reduced environmental impact. This vision is becoming reality under Mediterranean Shipping Company's (MSC) strategic expansion, as its logistics arm MEDLOG takes over operations at Dhaka's Pangaon Inland Container Terminal (PICT) while slashing river barge freight rates by up to 50%.
Pangaon Inland Container Terminal: A Strategic Hub
Strategically located along the Buriganga River near Dhaka and adjacent to the Dhaka-Mawa-Bhanga highway, PICT serves as a critical junction connecting the capital with Chattogram, Bangladesh's primary seaport. The terminal's importance lies in its potential to divert freight traffic from overloaded roads to river transport – easing congestion, cutting emissions, and improving supply chain efficiency. MEDLOG's management takeover represents MSC's significant investment in strengthening Bangladesh's multimodal transport network.
MEDLOG's Terminal Upgrade Strategy
Under a newly signed concession agreement with the Bangladeshi government, MEDLOG will implement comprehensive upgrades at PICT:
- Equipment modernization: Introducing advanced container handling machinery to boost operational efficiency
- Automation systems: Implementing digital management solutions to streamline processes
- Capacity expansion: Extending storage yards to accommodate growing cargo volumes
These improvements aim to increase PICT's annual handling capacity to 160,000 TEUs (twenty-foot equivalent units).
Building a Multimodal Network
MEDLOG's strategy focuses on creating an integrated transport system linking PICT with Chattogram Port through increased barge operations. River transport offers substantial advantages over road haulage – lower costs, greater capacity, and reduced environmental impact. This multimodal approach provides shippers with more flexible and economical logistics solutions.
Dramatic Rate Reductions: Up to 50% Cheaper
To make water transport more competitive, MEDLOG implemented sweeping rate cuts effective January 24, 2024, for the Dhaka-Chattogram barge route:
| Direction | Container Type | Previous Rate ($) | New Rate ($) | Reduction (%) |
|---|---|---|---|---|
| Export | 20ft | 175 | 70 | 60 |
| Export | 40ft | 220 | 140 | 36.36 |
| Import | 20ft | 324 | 190 | 41.36 |
| Import | 40ft HC | 445 | 282 | 36.63 |
The new rates present compelling savings compared to road transport, which costs approximately $500 per trailer for the same route. MEDLOG has begun chartering local barges, initially focusing on the Chattogram-PICT corridor.
Industry Response and Challenges Ahead
The initiative has drawn positive reactions from Bangladesh's business community. Former BGMEA President Faruque Hassan noted the direct benefits for manufacturers and called for increased barge frequencies to reduce transit times. An electronics importer in Dhaka indicated willingness to shift Chinese imports to river transport if service quality improves.
While the move signals progress in Bangladesh's push toward containerized river transport, challenges remain:
- Navigational constraints in some river channels requiring dredging
- Limited domestic barge capacity needing fleet expansion
- Underdeveloped infrastructure at secondary river terminals
Despite these hurdles, MEDLOG's entry injects new momentum into Bangladesh's logistics sector. With continued infrastructure investment and operational improvements, the country moves closer to establishing a more efficient, sustainable freight network to support its rapidly growing economy.