Payra Port to ink fresh dredging deal with Belgian firm

Deal to allow Payra to get Tk 54.17b from forex reserve

Staff Correspondent   | Published: 01:36, Jun 13,2021


The Payra Port Authority is going to sign a fresh deal today with Belgian company Jan de Nul to dredge Rabnabad channel in the Bay of Bengal.

The signing in a city hotel will pave the way for using the first-ever fund from the country’s foreign currency reserve by the PPA to implement the dredging scheme, said PPA officials.

On March 15, the government announced formulation of the Bangladesh Infrastructure Development Fund to provide Tk 54.17 billion fund in Euro to the PPA for the dredging purpose.

The disbursement of the fund is under process, said a PPA official.

He added that the proposed deal was the most important part of the fund releasing process.

In February, the government scrapped approval given to Jan de Nul by the cabinet committee on economic affairs in October 2020 for the same dredging project at a cost of Tk 8,643 crore, supposed to be arranged by the Belgian company as loans.

Later, the government decided to engage the same company to carry out the dredging with the foreign currency reserve fund under a fresh negotiation with it.

The government also revised down the dredging cost at Tk 54.17 billion.

PPA officials said that Jan de Nul would dredge around a 70-kilometre stretch of Rabnabad channel over a period of 14 months.

The dredging will ensure over a 10-metre draft to allow ships with the capacity of 40,000 tonnes during low tide, they said.

The PPA officials said that Jan de Nul would remain engage in maintenance dredging of the channel for two years after completion of the dredging under the proposed deal.

The PPA will buy dredgers in future to take over the responsibility of maintenance dredging.

The Bay of Bengal receives massive volume of sediments carried by the county’s rivers that poses a challenge for the port operator to host large ships.

Recently, the government has also stepped back from its plan to turn the Payra Port a deep-sea port because of the requirement of huge funds at a silt-prone area of the Bay.

Economists, including former Bangladesh Bank governor Salehuddin Ahmed, have already urged the government to be more cautious in using the forex reserve for development works.

The country’s forex reserve is hovering around $44 billion amid higher inflow of remittance.         

The Payra port is being constructed with an aim to develop the country’s southern parts.

Since its operation in 2019, the Payra port has received 106 oceangoing ships until December 2020.

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