Bangladesh is in the journey of transformation towards a non-LDC developing country by November 2026. Economic development of the country is in flux, mostly depending on labor-intensive industrial export-driven model, Bangladesh can face challenges of for sustaining competitiveness in future. Efforts are to be taken to prepare for technology-supported capital-intensive industrial development strategy for which it needs necessary funding, reduce cost of doing business, time and streamline the process through extensive automation. Effective and efficient logistics support to the businesses is the main enabler to increase competitiveness. Formulation of a Logistics Policy was a long-standing demand from the private sector, now the policyexists, needs proper implementation.
Bangladesh's improvement in the Logistics Performance Index (LPI) ranking(The Logistics Performance Index and Its Indicators by The World Bank) climbing 12 notches to 88th in 2023 among 139 countries surveyed, is a testament to its efforts in streamlining logistics processes. This progress is encouraging and demonstrates the potential for further growth and development. The LPI evaluates countries across six logistical dimensions: customs performance, infrastructure quality, international shipments, logistics competence, tracking and tracing, and timeliness. Consequently, rankings and scores across these specific areas may differ from a country's overallposition in the LPI. Efficient logistics is the linchpin of trade competitiveness. According to the Logistics Performance Index 2023, a comparative analysis of six key activities of the logistics sector with competing countries in specified shows that Bangladesh needs improvement a lot.
It is seen that since 2010 ranking of Bangladesh in customs is almost same at 2.3, whereas in Singapore it is 4.2, and even in Vietnam it is 3.1. In all other indices particularly in that instance of infrastructure, International Shipments, Logistics Competence, and Timeliness, Bangladesh is behind similarly placed countries such as India, Indonesia, Vietnam, Singapore, and the Philippines.
In other global logistics indices such as the Container Port Performance Index, Liner Shipping Connectivity Index, Agility Index, and Trading across Border Index, Bangladesh's performance needs to be improved. Key factors such as terminal capacity, terminal costs, landside connectivity, port-to ship and ship-to-port performance are reviewed under this index. According to Container Port Performance Index in 2023 it is seen that ranking of the Chattogram port is declined compared to the previous ranking. The government should focus on the reasons and maintain good practices to avail international markets.
Public and Private sector worked together since 2020 and had a series of discussion, workshops to prepare a need-based policy. It analyzed the important features of logistics policy of different countries and prepared the rule book with a clear monitoring mechanism, prioritized the reforms, identified Key Performance Indicators (KPI).
The logistics policy emphasizes the importance of technology and digitalization of services for which technology adaptation capacities must be increased. Identifying the sequence of new projects in the vital areas and its implementation to meet the vision and objectives of the policy, establish a technology base, governance structure and development of other required tools are crucial. Bureaucratic set up of different ministries, agencies, departments in charge of implementing several projects and activities creates delay because of several complexities, documented and undocumented requirements. A digitally supported coordination mechanism must be established to expedite the decision-making process.
The policy has given importance on using ICT, artificial intelligence and in that respect capacities of the government officials and the concerns for providing time-bound services is an utmost necessity. Corporates demand efficient manpower in the required fields to respond to the need of reducing lead time of business.
An estimated injection of at least USD300 billion until 2031 for infrastructure development, reaching 6% - 7% Infrastructure investment to GDP from the present 3.6% is required for the country as per private sector assessments. Perspective Plan 2021-2041 targeted an annual investment for the infrastructure at US$ 10 billion, Perspective Plan of Bangladesh 2021-2041(page 98).Implementation of already identified fast-tracked projects and recalibrate the priorities depending on the present needs is an essential goal.
Bangladesh is one of the late starters in announcing Logistics Policy where the countries like Vietnam, Singapore, Indonesia, India have announced Logistics policy much earlier and planned strategic goals for ease of doing business and supporting private sector to enjoy soft and hard infrastructure to be competitive. Now a days, practicing green logistics pathway can be in built in all aspect of the activities so that competitiveness can be sustained.
Data management and GIS Data- base Platforms is the priority to understand and integrate data layers for specific needs integrating all these issues with the national plans. Tools need to be established for an effective coordination mechanism among Ministries, agencies, and departments for exchanging project-based information while initiating new projects. Complete mapping of KPI -based activities in the NLP 2024 is an urgent need.
Industrial Policy 2022 has included 21 logistics subsectors, private sector investment can be attracted in these sectors. A separate warehouse policy for the freight forwarders to reduce dependency on the ports, centralized bonded warehouse, air freight stations are some other primacies for the private sector. An Infrastructure Development Master Plan aligning to the framework of 9th FYP has been planned, however, it may be delayed because of present political situation. Private sector needs to pursue for its implementation for logistics support for them.
Stock-taking of all necessary skill development training programs being provided by different organizations in the country and evaluate them as per the present need and recommend specialized programs for required capacity building is another priority. Bangladesh can borrow benchmarking practices from the global players to re-invent the need of the sector with modern management and equipment.
An up-stream study needs to be commissioned to chart out the short- mid- and long-term capacity building training of the country.Accreditation and certification of the training programs by the specialized organizations is another priority for ensuring quality and proper standards.
Ensuring flexibility and agility, adaptation of appropriate technology to quickly adapt to the need of the changing market conditions should be one of our significances. Supporting the private sector to understand the market demands, expand businesses and market share, adequate investment plan for profitability and earn revenue in today's competitive market is another prerequisite. In view of that a Capacity Building Commission (CBC) following successful examples of similarly placed countries can be a proposal to be placed to the government.
Sustainable Green Logistics involving all relevant Ministries/Agencies could create a green pathway for establishing new industrial parks, solarization, recycling and desalination plants. In having these activities, planning for trained manpower needs to be included in the curricula.
A permanent coordination mechanism through the concerned ministries with specific importance on establishing a separate Logistics Department (LD) or establishing a separate Bangladesh Logistics Development Authority can be an option for an efficient and unceasing logistics support system in the country.
Now an interim Government is prevailing in the country, supportive reforms can be initiated and implemented through proper channel for ease of doing business and attracting investment in the country. We have seen a long list of registration of projects in the investment promotion agencies in the country, proper follow-up for actual implementation, and why the intending investors are turning back needs detailed study to understand the real challenges. Only announcement of nice policies will not create benefits automatically unless these are implemented by the respective government machineries.
The writer is Chief Executive Officer, Business Initiative Leading Development (BUILD)
