Charting Opportunity in the Bay of Bengal

Posted by Fatema Z. Sumar
June 3, 2014
An Indian Fishermen Throws His Net in the Backwaters of Devanampattinam in Cuddalore

As we motored up the Karnaphuli River -- the main waterway that connects the vibrant Chittagong Port to the Bay of Bengal -- it was hard to imagine that we had found ourselves in the middle of a region that is, by some measures, the least economically connected region in the world.  The expansive waterway was teeming with container and shipping vessels.  Onshore, two of Bangladesh’s most successful export processing zones were humming with activity.  Western Marine Shipyard Ltd., a Bangladeshi shipbuilder recently written about in The New York Times for its exceptional commitment to the health and safety of its workforce, had a large, passenger ferry sitting atop its dry-dock, with hundreds of workers attentively working on the vessel.  Chittagong is the future: a geo-strategic hub ideally situated at the mouth of the Bay of Bengal, with proximity to India, Burma, China and the other countries of South and Southeast Asia.  It’s the bulls-eye of the Indo-Pacific region.  But, at least at the moment, it’s also an energy-starved metropolis contending with the threat of rising sea-levels, inadequate physical infrastructure and paltry overland transportation links.

Later, some 225 miles to the west, we found ourselves sitting with the Chairman of Kolkata’s Port Trust.  He offered an inspiring message of growth and connectivity, touting several regional port projects in the offing, including Sagar Island, which would host 50 million tons of container and goods cargo each year and offer global trans-shipment connectivity to a region sorely in need of deep-water port capacity.  Why is this so important?  We heard anecdotes about goods traveling from this sliver of coast all the way to Singapore on smaller boats, before being offloaded and shipped right back to the Subcontinent.  This represents enormous economic inefficiency, solved only by intra-region coordination, streamlined regulatory architectures, and enhanced capacity amongst the Bay of Bengal’s maritime ports.  

Further south in Chennai, we came away impressed with the potential of a city -- a nexus of trade in centuries past -- to be a sustainable beacon for seaborne commerce.  The Port of Chennai is setting itself apart, embracing the designation of a “clean” port that refuses to offload shipments of coal and iron ore. American companies like Ford and Caterpillar have developed sophisticated manufacturing operations near the city, and the state of Tamil Nadu is home to 4 major ports, 13 minor ports, 37 Fortune 500 companies, and ranks third amongst Indian states in the amount of foreign direct investment (FDI) it courts each year.  Geography has blessed the city, bestowing it with a location that affords a straight shot, due south-east, to the Strait of Malacca and the sea lanes that bear 65,000 containers ships a year, and hundreds of billions of dollars’ worth of traded goods.  But the question in Chennai remains: will infrastructure development meet the unique demands of trade and commerce in the 21st century?

The challenges to connectivity in the Bay of Bengal region are complex and capital intensive.  They require joint political and economic action by stakeholders in the region.  So what’s the role of the United States?  We’re an Indo-Pacific power in our own right, and we’re committed to helping grow an Indo-Pacific Economic Corridor -- or IPEC as we like to call it -- where the markets, economies, and people of South and Southeast Asia are connected, offering prosperity and security to hundreds of millions of people.  To do this, the region’s stakeholders -- governments, international financial institutions, and the private sector -- must band together to enhance physical infrastructure, streamline the region’s regulatory architecture, and improve human connectivity.  And believe me; it will be worth the effort.  For, as I traveled through its most historic cities and endearing nooks, I couldn't help but see a different Bay of Bengal than the one that exists today.  I see a region marked by promise, poised to shape global commerce in the 21st century rather than be marginalized by it.

About the Author: Fatema Z. Sumar serves as a Deputy Assistant Secretary of State for South and Central Asian Affairs.

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