After long delays, China has finally granted and signed a $336 million loan agreement with Bangladesh to build two container jetties at Mongla Port, the country’s second-largest seaport.
The deal was signed in Dhaka on Monday, October 12, by Economic Relations Division (ERD) Joint Secretary Alia Meher on behalf of Bangladesh and EXIM Bank Assistant General Manager Fengjun Tian on behalf of China.
A press statement issued by the ERD said China will charge 2% interest on the loan, as it is concessional credit.
With the Chinese funding, Mongla Port will build two container jetties, each with a total length of 368 metres. A laden container yard spanning 87,600 square metres will also be built, along with a 34,170-square-metre empty container yard and a 4,260-square-metre hazardous cargo-handling yard.
The funding will also be used to acquire modern equipment for the faster handling of containers and other cargo. Mongla Port officials said four gantry cranes, seven rubber-tyred gantry cranes and 33 other pieces of jetty-related equipment will be purchased under the project to modernise operations.
The expansion of container and cargo-handling facilities with modern equipment will help increase Mongla Port’s annual handling capacity by 394,000 TEUs.
The Chinese government nominated China Civil Engineering Construction Corporation (CCECC) as the project’s implementing agency. In June, Bangladesh and China signed a framework agreement to finance the construction of the Mongla Port project.
Earlier, India had also pledged funding for the construction of jetties at Mongla Port. After being nominated by the Indian government, Egis India Consulting Engineers Private Limited signed an agreement with Mongla Port in December 2022 to act as a consultant for the capacity-building project.
However, following a change in Bangladesh’s political landscape that soured relations with India, the funding proposal did not proceed and was stalled indefinitely.
Businesses welcomed the signing of the agreement and called for construction of the jetties to begin quickly, saying that the enhanced capacity would make the port more attractive for handling the South Asian nation’s growing external trade.
Alamgir Hossain, a Dhaka-based trader, said Mongla could become an alternative trade gateway if its capacity were expanded through the construction of new jetties and the installation of modern equipment.
“Its capacity remained underutilised in the past due to the underdeveloped transport system,” he said, adding that businesses are now showing greater interest in the port because the construction of a bridge over the Padma River reduced the distance several years ago.
