Despite equipment constraints, local logistic companies by using local skilled human resources are providing admirable services to infrastructure development of Bangladesh. Still the infrastructure development companies prefer foreign companies in doing their works. Hence for marginal profits, the local companies are forced to provide their services as sub-contractors. Policy support of the government is essential now for the growth of local logistic companies to be equipped with modern, efficient equipment and getting the works as main contractors. Chairman of local logistic company KN Harbour Rezaul Haq Chowdhury Mushtaq raised the concern in an exclusive interview with EP Editor Mollah Amzad Hosaain.
Perhaps the infrastructure development works in Bangladesh now at its peak since independence. Alongside, the local logistics companies were expected to grow efficient by this time as well. How do you evaluate the status of support services in Bangladesh now?
You are very correct. The local logistic service providers have not developed simultaneously with the massive growth of infrastructure development activities. The main reasons are lack of required government support and non-availability of modern efficient equipment. But local companies would not take much time in developing equipment capabilities if the policy support is extended.
The reality is very different. Foreign Companies engaged in infrastructure development are not using local logistic companies at all for their works. They are engaging companies from their own countries. Then those companies are using only a few local companies as their sub-contractors. Consequently, though local companies are doing bulk of the works, yet foreign logistic companies acting as brokers are taking away most of the profits. Without the policy support of the government, it is not possible breaking through the situation.
Mention should be made here that there remains some equipment constraints, yet local logistic companies have capable human resources. Even then local companies are very efficiently transporting goods and materials from the ports to project sites. Internal logistic works of Rampal and Matarbari projects are being successfully done by local companies. Right policy of the government can help assist growth of this local industry. This will provide boost to local economy as well.
It has come to our notice that all the logistic works of the first Floating Storage and Re Gasification Unit (FSRU) at Maheshkhali have been done by the local companies. Please tell our readers about it?
KN Harbour did maximum volume of works for the survey and EPC phase that got the logistic works for the first FSRU. Starting from preparing and processing all paper works for various permissions and permits, we did all the onshore and offshore transportations and manpower supply. We have provided all local services to foreign experts. Starting from camp set up at zero point, KN Harbour provided all support services to the EPC companies for all construction works. Apart from these works like C&F, crew movement, community management, catering, warehouse, visa and immigration services were also provided.
Local and foreign companies engaged in infrastructure development often tell that local logistic companies do not have required modern equipment and also lack experience. Hence they hire foreign companies. What are your views?
I do not agree with this excuse. There is no doubt that foreign companies have more sophisticated equipment. But local companies using earlier generation equipment are also providing admirable services. Local companies using these equipment and expert human resources are providing better services than foreign companies. Local companies are doing these works at far more competitive rates. Finally, though foreign companies are given the works these are actually accomplished by local companies as subcontractors. But local companies do not have ISO and API certificates for participating in the tenders.
Local companies can acquire the equipment if they are engaged as main contractors for the works. If necessary these can be hired on rent. Subsequently, ISO can be achieved.
I suggest for incorporating a provision for engaging local logistic companies in the contracts of the government agencies and foreign companies for infrastructure development.
A few 1200-1320 MW imported coal-based power plants are now at different stages of implementation in Bangladesh. Are local companies equipped with human resources and equipment for providing support services for these?
Your question has no direct response. No local company on standalone basis can do all works. But if the government is willing, the local companies in joint venture with foreign companies can do these works. We have already started the primary logistic works of a private company’s coal power project. Local power companies have now become capable for constructing power plants as the government provided the necessary policy support. If similar support is extended to local logistic companies, they can also grow as competitive as foreign companies.
How Long KN Harbour is in the business? How many local companies you think are ready at this moment for such works?
Some 7-8 companies are now capable of providing complete services. We are in this business since 1988. We started with Rawjan Power Plant works. Then we worked at Barapukuria coal power plant and Saipem Constructed North South Pipeline project. Now we are providing logistic services to Gazprom, Rooppur Nuclear Power Project and LNG.
We are providing services like rig mobilization, rig foundation construction-related services to Gazprom. We are doing partial works at Rooppur plant. We have got complete technical capabilities for works like bridge reinforcement etc.
What kind of equipment technical limitations you have for providing logistic supports to infrastructure development projects in Bangladesh? How you are confronting these?
The roads and highways in Bangladesh are not yet of international standard. As such these are not suitable for low bed axle bearing transports. There are not many such transports also available. We worked to handle such critical heavy cargo by using imported low bed axle carriers, Max power logistic service.
Most of the mega projects are in far flung remote areas where transport facilities are very poor. If there is no facility for waterway transportation, road communication needs to be developed for transportation of equipment and plant. But large power plants are mostly besides rivers. For these there are facilities and riverine vessels for transporting over dimensional cargoes (ODCs). But for load restrictions in highways, it is not possible to transport more than 70-80 tonnes heavy cargoes on road. Use of low bed axle carriers can overcome this. But there is serious shortage of such vehicles.
On the other hand, ODCs after transportations to sites are manually unloaded. SMPT is required to unload these safely and put in place. Though Bangladesh is listed in SMPT, yet it does not have any. This creates great problem. But local companies can get this if there is assurance of getting works without interruptions.
Due to imposition of several compliances by companies like Chevron, local companies are not getting opportunities. The government needs to provide policy support.
How do you assess the human capital of Bangladesh in logistic services? How efficient they are for accomplishing the works?
We have excellent human resources though we have equipment shortages. We are successfully handling cargoes up to 400 tonnes using manual and semi mechanical technologies. One example can be given. The equipment and plant of Max Cushier power plant could be transported to Ashuganj from Mongla port using even 3 meter water draft. Even the river channel was dredged for this. It was possible for efficiency of local manpower.
It appears from discussion with you that there exists shortage of modern equipment for providing logistic services more efficiently for major infrastructure projects. How can this be overcome?
I have already mentioned this in bits and pieces. If local companies get works of large power and energy projects, they would acquire modern equipment. On the other hand, if enough work scopes are created, such equipment may be imported by few companies and rented out to us for use.
Hence, local companies would not be able to provide complete logistic services to large infrastructure projects without required policy support of the government.
