Will apex meeting between Bangladesh-China remove the obstacles to the modernization of the Mongla sea port?

Mongla is the second largest seaport in the country. The government has taken initiatives to increase and modernize the facilities of this important seaport in South Asia. As a part of this, various activities including jetty construction and container yard construction have been undertaken. However, implementation activities cannot be started due to various reasons including geo-political complications.

The government was hoping for getting financing support from the Chinese Government in the project titled ‘Expansion and Modernization of Mongla Port Facilities’. However, possibly due to the pressure exerted on Bangladesh by India, this project has been pending since last September. It is said that there has been a positive change in the attitude of India through Prime Minister Sheikh Hasina’s visit to India recently. In this situation, during the upcoming Prime Minister’s visit to China, the high-level meeting of the two countries may remove the obstacle to the modernization of Mongla Port.

In this matter to take Shipping Ministry’s opinion several times have been approached but concerned authority do not like to comment at all in this regard.

Upon request from Bangladesh, China International Development Cooperation Agency’s (CIDCA’s) gave preliminary approval of a project titled ‘Expansion and Modernization of Mongla Port Facilities’ on 14 December 2022. Contract negotiation between a potential Chinese contractor and Mongla Port Authority was completed on 21 June 2023. The project was sent to the Executive Committee of the National Economic Council (ECNEC) by the Ministry of Shipping on September 12 last year, Prime Minister and ECNEC Chairperson Sheikh Hasina approved the project at the NEC conference room in the capital’s Sherebangla Nagar. At the end of the meeting, the then Planning Minister MA Mannan and the State Minister for Planning briefed the journalists. Shamsul Alam said that 19 projects were approved in each meeting. Among these, the Prime Minister has approved the project titled ‘Expansion and Development of Mongla Port Facilities’ to increase the capacity of Mongla Port. The implementation of the project will cost BDT 4, 282.76 crore. Out of this, BDT 500.39 crore will be spent from government funds and BDT3,782.36 crore from Chinese soft loans. The project will be implemented by Mongla Port Authority by June 2027 starting from this year.

It has been found that in the meeting minutes of the 19 projects approved by ECNEC dated September 12 last, the heading ‘Expansion and Development of Mongla Port Facilities’ was not kept. The project was surprisingly dropped from the meeting minutes of ECNEC. On January 29th, 2024, around 4.5 months after the ECNEC meeting held on September 12th, 2023, the Planning Ministry sent a letter to the Ministry of Shipping, informing the Ministry of Shipping that the project shall be re-examined and presented to ECNEC later, without mentioning any specific issues to be re-examined.

Various sources indicate that the confusion and delay in the meeting minutes of ECNEC occurred due to the rivalry between India and China. This is not the first case of such rivalry. India is thought to have opposed China funding a deep-sea port at Sonadia in Chattogram. In 2014, Bangladesh was about to sign the deal but canceled the project under pressure from India, irking Beijing. India’s recent decision to send a technical team to Bangladesh to study the management of the Teesta River also seems more like an action to counter China’s initiative to support Bangladesh for the same project, rather than a genuine plan or intention to resolve the Teesta issue for Bangladesh.

According to the Ministry of Shipping, Mongla Port is in a convenient position for handling cargo from the border areas of various Asian countries in terms of geographical location. In particular, the use of the port as a transit point is very promising. Moreover, as a result of the construction of the Padma Bridge, direct road communication and the construction of the Khulna-Mongla railway have opened direct rail communication. As a result, the importance of the port has increased. But as such the existing facilities of the port are inadequate. For this reason, the government is trying to modernize the port. Now, if modernization stops for any reason, Bangladesh will fall behind.

As per the plan of Mongla Port Authority, 6 new jetties will be constructed at Mongla Port in addition to the existing 5 jetties, i.e. Jetty No. 5-9. Among these, India will provide loans for the construction of Jetty No. 1 and 2; Saif Powertech, a Bangladeshi company, has been awarded with Jetty No. 3 and 4 in PPP modality; the Chinese government will provide a concessional loan for the construction of Jetty No.10 and 11. Such an allocation seems to have reflected a good strategy of balance and serves the best interest of Bangladesh. Cooperation with one party should not be hindered by cooperation with another party because both China and India are crucial partners of Bangladesh that follows “malice to none and be friendly to all” in its foreign policy. Bangladesh will also remain in an advantageous position if India and China are encouraged to compete in expediting their respective jetty development, instead of delaying or disturbing one another’s development activities. If the suspension of the project to be funded with China’s concessional loan is due to India, Bangladesh might be taking an unwise track deviating from a balance strategy that serves the best economic and security interest of Bangladesh.

While visiting Bangladesh in October 2016, Chinese President Xi Jinping promised about $20 billion — the largest amount committed by a bilateral partner of Bangladesh — over the following four years to implement 27 projects, including this project of Expansion and Modernization of Mongla Port Facilities. Although China had promised to lend about $20 billion in 2016, as of January this year, the two sides managed to sign agreements on only nine projects, involving $8.08 billion, figures from the ERD show. Of the $8.08 billion, Bangladesh could utilize only $4.91 billion, less than a quarter of the money promised by China. If the suspension of the project or some more projects in the big deal between China and Bangladesh is due to the rivalry between India and China, Bangladesh need to manage the geopolitical issues carefully and smartly.

Potential of Mongla Port: Mongla port has potential for the economy of Bangladesh. That is why the government is taking various steps to develop the port. Meanwhile, various projects including Padma Bridge, Padma Bridge Rail Link, Khulna-Mongla Railway Line, four-lane road up to Mongla, purchase of modern equipment for the port, inner-bar dredging, outer-bar dredging have been implemented and are in progress which are making the port dynamic.

The government has implemented a total of 19 development projects and 4 development programs at a cost of Tk 1,899 crore from 2009 to 2023 for the development of Mongla port alone.

  • Under the development projects, dredging work of 3.11 crore cubic meters has been completed in an area of about 36 km at various places in the Pashur channel. As a result, ships with 10m draft up to anchorage and 8.5m draft at the jetty area are able to arrive and depart smoothly during normal tides.

Simultaneously 128 different types of buoys, two rotating beacons, six GRP light towers and ancillary equipment have been installed in the harbor channel.

  • According to Mongla Port Authority (MPA) data, container handling at the country’s second largest seaport increased by 30.59% during July-March of FY 2023-24, while net profit increased by 21.28% compared to the same period last year.