China delays financing for Mongla port’s two new jetties

China delays approving a concessional loan proposal for US$335 million for construction of two jetties at Mongla seaport to augment its container-handling capacity, officials say.

Already, seven months have elapsed since the Economic Relations Division (ERD) sent the proposal to Beijing but is yet to get a positive outcome on the funding, delaying the project development.

In the first week of February, the Executive Committee of the National Economic Council (ECNEC) approved the Tk 40.68-billion project for expansion and modernisation of Mongla port facilities.

Later, the Mongla Port Authority (MPA) and China Civil Engineering Construction Corporation (CCECC) in late March 25 signed contract for implementation of the project.

In late April, the ERD sent the loan application to China. However, officials say, the Chinese government has yet to approve the loan application.

The 'Expansion and Modernisation of Mongla Port Facilities' was listed among the 27 development projects that China pledged to fund by signing an umbrella deal back in 2016 when Chinese President Xi Jinping visited Dhaka.

The Mongla Port Authority had signed a Memorandum of Understanding (MoU) with the CCECC in August 2021 which later submitted its financial bid and technical proposal on January 28, 2023.

The project aims construction of two container jetties with a total length of 368 meters, 87,600 square-meter loaded-container yard, 34,170 square-meter empty-container yard, and 4,260 square-meter hazardous cargo-handling yard.

Moreover, four gantry cranes, seven rubber-tyred gantry cranes and 33 other jetty-related equipment will be bought under the project.

The two new jetties will enhance Mongla port's container-handling capacity by 394,000 twenty-foot equivalent units (TEUs) per annum.

Contacted, Alia Meher, a Joint Secretary at the ERD, told the Financial Express the loan application is under process.

"Processing Chinese loan takes time," she says, adding that it is still under process.

Muhidul Islam, an Additional Secretary who oversees Development Wing at the Ministry of Shipping, confirms that no progress regarding the loan application has been made so far.

They need to get approval on the funding from their ECNEC. The loan proposal may be included in the next fiscal budget of China, he says.

"It is not certain when we can get money from China for this project."

Dr A K M Anisur Rahman, Member (Engineering and Development) at the Mongla Port Authority, says until now, they did not get response from the Chinese side since sending the loan application.

"A week back, they informed us that the proposal is under consideration and they are scrutinising the project," he adds.

Asked whether any development work is ongoing relating to the jetty development, Mr Rahman answered in the negative.

syful-islam@outlook.com