China pumps money in project jointly taken by Dhaka, New Delhi: Nikkei Asia

India and Bangladesh’s strong friendship ties are visible through the Bangladeshi port Mongla, where New Delhi had invested its resources but now China is also stepping forward for this project, competing with the former nation, Nikkei Asia reported.

Bangladesh’s second-largest port, Mongla, is one of the projects where India has transhipment facilities to carry goods to its landlocked northeastern states. In 2015, the governments of Bangladesh and India decided to upgrade Mongla under a line of credit from New Delhi.

After approving the project, Mongla Port Authority signed a deal with Egis India Consulting Engineers in late December.

Meanwhile, China, which has been eyeing the facility for years is taking up steps in having the Bangladeshi port Mongla. This move is “very surprising,” Delwar Hossain, director of the East Asia Center at the University of Dhaka, said of the often bitter rivals agreeing to fund the same port.

China, signed an umbrella deal in 2016 when president Xi Jinping visited Dhaka, under which it pledged to fund 27 development projects including an expansion and modernisation of Mongla’s facilities. Yet, although a feasibility study found the project “crucial” for Bangladesh, Beijing was slow to pony up the planned USD 400 million, reported Nikkei Asia.

Earlier, on 14 December, after the reports surfaced on New Delhi’s selection of Egis, Beijing confirmed to the Bangladeshi Finance Ministry that it was willing to fund the project.

Reacting to the recent development over Mongla port, Rear Admiral Mohammad Musa, chairman of the Mongla Port Authority, said, “Both the investments are important for us, because Mongla Port is now getting more exports and imports, while the capacity is not sufficient to house all the future requirements. Thus, we need to expand, we need to build the infrastructure.”

Interestingly, China which is popular for its opaque system of loan transferring and the debt trap, Bangladesh finds them as an “important” player in its projects.

The Padma Multipurpose Bridge, which opened last year, has added to the port’s appeal, reducing the road distance to Dhaka to just 170 kilometres from about 280 km. Chattogram, meanwhile, is a 260 km drive from the capital, said the Nikkei Asia report.

Musa said that under the Chinese investment, two container terminals and delivery yards will be built. On the other hand, the Indian funding will allow the construction of jetties, roads, parking lots, offices and even a residential complex.

Musa explained that the two projects will be in different areas of the port. “The two contexts are different, the funding system is different, and the works are also different,” the chairman said. “So they are not going to collide with each other.”

Some say it may not be quite that simple.

Md. Touhid Hossain, a former Bangladeshi foreign secretary, acknowledged the rivalry between India and China but stressed Dhaka has sought to maintain close relations with both.

“Due to political and strategic aspects, one country always remains tense about how much influence and investment the other country [has in] Bangladesh,” Nikkei Asia quoted Hossain as saying.