HSIA's 3rd terminal: Contractor demands additional cost

Aviation Dhaka Consortium (ADC), the joint venture responsible for implementing the Third Terminal Project at Hazrat Shahjalal International Airport (HSIA) in Dhaka, has submitted a claim to the government for an additional 3 per cent over the original contract value, citing various commercial disputes.

Officials of the joint venture, comprising Mitsubishi Corporation, Samsung C&T Corporation, and Fujita Corporation, submitted the claim in a letter addressed to the advisor to the Ministry of Civil Aviation and Tourism (MoCAT) last month.

In the letter, the ADC proposed a final revised Contract Amount of Tk 160.30 billion, an increase of 3 percent over the original contract amount of Tk 155.63 billion for an amicable settlement.

The project, costing Tk 213.99 billion, was launched on December 28, 2019. The Aviation Dhaka Consortium signed a contract on January 14, 2020 for the construction works of the facility at a cost of Tk 155.63 billion.

The ADC requested the advisor to form a Dispute Board by June, 2025 to address the issue. Otherwise ADC will refer the dispute to the International Chamber of Commerce (ICC) in accordance with the agreement, it warned.

Delay in Dispute Board constitution by the Employer, the Civil Aviation Authority of Bangladesh (CAAB), provides more than contractual ground for by passing the dispute board and directly proceeding to arbitration, also read the letter.

Meanwhile, the Ministry of Civil Aviation and Tourism  (MoCAT) and the CAAB have held a series of talking regarding the ADC claims and already formed a seven-member dispute board to settle the claims of the ADC, a senior CAAB official told the Financial Express on condition of anonymity.

Except for minor outstanding works such as the boarding bridges and interior works for VVIP facilities, the project was practically completed around December 2024, and the Taking-Over Certificate (TOC) was formally issued on January 2024, said the letter.

The ADC also claimed that despite the practical completion of the project, it could not hand over the terminal facilities due to the failure of the CAAB to appoint an operator for the new terminal, which falls outside the scope of the contractor's responsibilities.

The negotiation between the CAAB and the Japanese consortium, that will take the charge of operation and maintenance work of the newly built third terminal of the country's prime international airport, is being delayed due to lack of consensus on certain conditions, said the CAAB official.

The CAAB has already held extensive discussions with the consortium, however, need more time to reach into a consensus, according to the official.

Earlier, the CAAB anticipated finalising the agreement by June this year and commencing commercial operations at the terminal by December, given that the consortium requires a minimum of six months for preparation following the agreement.

Meanwhile, due to the lack of an operator the third terminal can not be brought into commercial operation despite the project being almost fully completed.

CAAB Chairman Md Mostafa Mahmood Siddiq told the Financial Express that the Ministry concerned has already discussed the claims of ADC aiming to reach an amicable solution.

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