Matarbari deep-sea port construction seems to be put on the backburner through surrender of 74 per cent of allocated funds, mainly from a Japanese loan, for trailing project deadlines, officials said.
Such delay in the deep-sea port development -- a key "fast-track" project financed and supported by the Japan International Cooperation Agency (JICA) -- could prove to be a disservice to Bangladesh's trade and business, insiders think.
Several officials point to a curious move by the Chittagong Port Authority (CPA)--the executing agency--in seeking a reduction in its funding request by Tk 21.12 billion to Tk 7.47 billion in the current fiscal year's (FY2023-24) revised development budget. The ADP is due for revision soon.
Of the original allocation of Tk 28.59 billion, the port authority made the largest cut of Tk 20.43 billion from JICA's confirmed loans for the deep-sea port in the Bay of Bengal.
As per the port authority's request, the government initially allocated Tk 28.59 billion, of which Tk 26.76 billion was earmarked to come from JICA's committed credits.
However, midway through FY24, the project-implementation agency abruptly surrendered the lion's share of the confirmed Japanese loans following a possible failure in utilising the money effectively for slow work progress, according to one official.
The Chittagong Port Authority has downsized its annual allocations and submitted revised funding requirements to the Planning Commission for incorporation in the revised annual development programme (RADP).
Meanwhile, with several key ministries facing challenges in implementing their development projects on time, the commission is working to revise the ADP and is expected to downsize allocations for the current fiscal year.
"The Chittagong Port Authority is now seeking a lower amount of funds that it can realistically spend in the remaining months of this fiscal year. Therefore, it has proposed the allocations to be reduced in the upcoming RADP," says Sanjoy Kumar Banik, additional secretary at the Shipping Ministry.
He hints that since there are some delays in getting concurrence from JICA on documents regarding their funding of the project, utilising the entire allocated funds this year is not possible.
However, Mr Banik told the FE that the unutilised funds would be carried over into the next fiscal year.
A Planning Commission official termed the surrendering of massive development allocation "concerning" as Matarbari is one of the most important "fast-track" projects of the government.
Approved in March 2020, the project carries a total cost of Tk 177.77 billion. JICA is the primary lender, contributing Tk 128.92 billion, while the Chittagong Port Authority and the government will provide Tk 22.13 billion and Tk 26.71 billion respectively.
The project encompasses two main components: a Tk 89.56-billion port- development scheme undertaken by the port authority and a Tk 88.21-billion road-construction project managed by Roads and Highways Department (RHD). The current deadline for completion is December 2026.
Nobody from the port authority was available for comment in this regard.
However, a CPA official said construction of the first terminal at Matarbari is imminent, with the tender process for selecting a contractor nearing completion.
The port authority has completed evaluating the technical and financial aspects of offers submitted by a Japanese joint-venture contractor that qualified for the tender.
While the terminal construction awaits its official start, visible progress has been made on creating a 14.3-kilometre artificial navigation channel connecting the proposed terminal to the sea, said the Chittagong Port Authority officials.
This channel was initially developed by Coal Power Generation Company Bangladesh Limited (CPGCBL) for its Matarbari Ultra Super Critical Coal- Fired Power Project before being handed over to the port authority in September 2023.
According to project officials, the first phase of the Matarbari Port Development Project comprises the first terminal, featuring a 460-metre container jetty and a 300-metre multi-purpose jetty, both with an 18.5-metre- deep draft, alongside container yards.
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