Maersk to expand in Bangladesh with 2 lakh sq ft warehouse at Chattogram
A.P. Moller – Maersk today announced that it is strengthening its operations in Bangladesh by partnering with Ispahani Summit Alliance Terminals (ISATL) for a custom bonded warehouse that will be the largest of its kind in Chattogram.
February 2, 2022: A.P. Moller – Maersk today announced that it is strengthening its operations in Bangladesh by partnering with Ispahani Summit Alliance Terminals (ISATL) for a custom bonded warehouse that will be the largest of its kind in Chattogram.
Bangladesh has been one of the most important sourcing markets for the garments and apparel industry worldwide.
The reasoning behind the expansion
“Despite the impressive growth of garments’ exports from Bangladesh, the number of warehouses in Chattogram have not increased since 2012 with the sole exception of ISATL that became operational in 2018,” reads the Maersk release.
“Optimizing utilization of available capacity assisted to an extent, however it did not scale enough to meet the trade’s requirements. The logistics ecosystem and the Chittagong Port get stretched, particularly during the peak seasons. In 2021, a fallout of this structural challenge was felt by all the stakeholders involved in import-export trade when the Container Freight Stations (CFS) got clogged with cargo resulting in delayed clearance, stuffing and consequently dispatch of containers to the port. Delay in offloading cargo also led to longer truck waiting time, and delay in despatch of containers to the port, consequently resulting in lack of overall productivity. These challenges have serious consequences on the overall economy of the country given the fact that the Chittagong Port handles in excess of 90 percent of the total containerized trade to and from Bangladesh,” Maersk explained the difficulties and reasoning behind the new expansion.
Recognizing these challenges, Maersk Bangladesh has partnered with ISATL to build a 200,000 sq. ft custom bonded warehouse. ISATL are pioneers in constructing and operating warehouses and CFS and operate four CFS within Chattogram and the River Terminal at Dhaka. Under the scope of this partnership, ISATL will construct a brand new custom bonded warehouse within the existing premises of the facility located at Pathortoli in Chattogram. The new warehouse will double the existing capacity at ISATL and add around 8 percent additional space to the existing ecosystem at Chattogram. The construction of the new CFS has already commenced and is expected to be completed in a phased manner by the end of 2022. Bangladesh’s exporters and their overseas buyers will be able to start using the facility from July 2022, once the first phase of construction is completed.
“Maersk’s commitment to connect and simplify our customers’ supply chains means that we look at long term solutions for problems such as the longstanding congestion within the ecosystem. We tackled the situation in 2021 by deploying an additional vessel for evacuating export loaded containers” said Angshuman Mustafi, managing director, Maersk Bangladesh. He added, “The solutions provided immediate relief to the ecosystem, but there was a need for a comprehensive solution to optimise ocean shipping, port handling and inland logistics that would benefit trade in the long term. By partnering with ISALT, we are establishing a facility that has the potential to partially decongest the system from the landside and streamline the flow of cargo in and out of Bangladesh.”
“We are proud to partner with Maersk on this exciting long term project where ISATL’s extensive local experience combined with Maersk’s international best practices will allow us to create a truly world-class facility that will help raise the standards for the entire industry”, said Yasser Rizvi, managing director, ISATL.
Maersk will also offer customers Garment on Hanger facility, sorting, product audit, labelling, bar code and RFID scanning amongst others.