Dhaka: Bangladesh is to charge fees, instead of duty, to India, to transport goods overland to its isolated northeastern states.

"Initiatives are under way to frame new rules to fix the amount of fees, in line with international practices," a finance ministry official told Gulf News.

He added that World Trade Organisation (WTO) provisions suggest that fees, not duties, should be charged by any country offering transit facilities for goods.

The official's comments came as Finance Minister AMA Muhith said Dhaka would need to charge India as it would be using Bangladeshi infrastructure for transporting goods.

Cost to government

"They will use our fac-ilities to transport their goods. Our infrastructure will be used and that involves some cost for the government. So we'll have to take something; it may be called a fee or anything," a newspaper yesterday quoted him as saying.

Muhith said the existing transit rules of the National Board of Revenue (NBR) would be amended to offer the facility. Bangladesh has offered India transit facilities since the time of independence and the country now receives fees of around 50 million taka (Dh2.6 million) annually for this service.

Exchange

But a new set of rules is now required for all the transit routes, as road and rail transport does not come under this remit.

The WTO affairs committee chairman of the Federation of Bangladesh Chambers of Commerce and Industries (FBCCI) chairman, Manzur Ahmad, told the Prothom Alo newspaper yesterday that the nations of the European Union (EU) and the Association of Southeast Asian Nations (ASEAN) countries charge fees for transit facilities.

"Bangladesh should not bar the charging of fees in exchange for the facility," Ahmad said. Dhaka and New Delhi last March signed a crucial shipping agreement to allow Indian goods to be shipped to its isolated northeastern Tripura state, through Bangladesh territory.

In July, Bangladesh also used India's transit facilities for its northeastern Chittagong and southwestern Mongla ports, under a landmark Dhaka-New Delhi agreement.