Chittagong Port: Foreign companies to operation two terminals

The responsibility for building and operating the Laldia Container Terminal of Chittagong Port is being handed over to a foreign company for 33 years. The Danish firm APM Terminals is set to take charge. The agreement for the construction and operation of the terminal is expected to be signed next week.

At the meeting of the Cabinet Committee on Economic Affairs held yesterday (Wednesday), the proposal to hand over the construction and operation of the terminal to a foreign operator for 33 years was approved.

The agreement includes a provision to extend the term by an additional 15 years. The signing between the Chittagong Port Authority and APM Terminals is scheduled for 17 November.

Besides the Laldia Container Terminal, the process of transferring the Pangaon Inland Container Terminal near Keraniganj, Dhaka, to the Swiss company Medlog SA is almost complete—awaiting only government approval.

The agreement for transferring the operational responsibility of the functioning terminal is expected to be signed soon. Amid discussions and criticism over hiring foreign operators for Chittagong Port, contracts for handing over two terminals to foreign firms are being finalised in the first phase.

Negotiations have also begun with the UAE-based company DP World regarding the operation of the New Mooring Container Terminal (NCT). The process to transfer this terminal to foreign management is expected to move forward in December.

In addition, two terminals under the Bay Terminal Project are also planned to be operated by foreign firms. Apart from these, foreign investors have expressed interest in investing in the Chittagong Container Terminal (CCT). If that too goes under foreign operation, the only terminal remaining under direct control of the port will be the General Cargo Berth (GCB).

Meanwhile, before signing agreements with foreign firms, the Chittagong Metropolitan Police (CMP) has extended the ban on processions and rallies in port areas for another month. In a public notice issued Tuesday, CMP Commissioner Hasib Aziz announced the extension of the ban until 11 December. As a result, no rallies or gatherings will be permitted in the port area before or after the signing of the foreign agreements.

Since the beginning of this year, various organisations have been staging protests over the government’s decision to hand over terminals to foreign firms. Initially, the Port Nationalist Workers Party led protests against foreign operation of the NCT.

Later, professional and political groups also voiced objections. The Chittagong Port Users Forum has protested as well, alleging that port fees were increased to make way for the foreign handover.

Former member of the Chittagong Port Authority Zafar Alam told Prothom Alo, “Since there is no existing infrastructure at Laldia, foreign investment in building the terminal is a positive move.

Handing over such a greenfield project to a global operator is a good decision. However, when it comes to existing terminals like New Mooring, more thought is needed before transferring control to foreign companies.”

Laldia Terminal Agreement

Under a Public-Private Partnership (PPP) on a government-to-government (G2G) basis, the Laldia Terminal is being handed over to Denmark’s APM Terminals. The International Finance Corporation (IFC), a World Bank affiliate, is acting as the transaction adviser for Bangladesh. Negotiations between APM Terminals and the Chittagong Port Authority, facilitated by the IFC, concluded last Monday after nearly a month of discussions.

According to the agreed terms, the main concession agreement is for 33 years, with the construction expected to take about three years. Subject to fulfillment of certain conditions, the term can be extended by another 15 years, giving APM Terminals control over the Laldia Char site for up to 48 years in total.

The company will build and operate the terminal at Laldia Char in Patenga, which will have three jetties capable of handling 800,000 containers annually. APM Terminals will invest USD 600 million in the project.

According to sources, APM Terminals will collect service charges from operations at the Laldia Container Terminal. The portion of the earnings that will go to the port authority has been agreed upon but not yet disclosed. The port will also receive a one-time payment from the foreign operator.

At a press briefing yesterday at the Foreign Service Academy in Dhaka, Ashik Chowdhury, CEO of the Public-Private Partnership Authority (PPPA), said APM Terminals will design, finance, construct, and operate the project, while ownership of the terminal will remain with the Chittagong Port Authority. Under the agreement, APM Terminals will invest a total of USD 800 million over the project’s full term. Once operational, the terminal will increase the port’s annual container-handling capacity by 800,000 TEUs.

Ashik Chowdhury added that construction is expected to begin by December or January, with a target of launching the terminal by 2029. After construction, APM Terminals will operate the facility for 30 years.

The Laldia Container Terminal project originated during the previous Awami League government. A G2G memorandum of understanding between Bangladesh and Denmark was first signed in June 2021. In January 2024, the two countries’ joint committee selected the Laldia project. The project gained momentum after the interim government took office.

APM Terminals is a subsidiary of Denmark-based Maersk Line, the world’s second-largest shipping company, and is headquartered in The Hague, Netherlands. According to its website, APM Terminals operates 60 ports and terminals in 33 countries. Its local partner in this project is QNS Container Services.

Pangaon terminal to be operated by Swiss firm

The Pangaon Inland Container Terminal, located in Keraniganj and operated under Chittagong Port, is being handed over for 22 years to Medlog SA, a subsidiary of the Mediterranean Shipping Company (MSC) of Switzerland. All formalities have been completed by the port authority. Medlog SA initially proposed an operational fee of Tk 1.08 billion, which was finalised at Tk 1.21 billion after negotiations. The final agreement will be signed after government approval.

The terminal was jointly built in 2013 by the Chittagong Port Authority and the Inland Water Transport Authority (BIWTA) at a cost of Tk 1.56 billion.

Professor Anu Muhammad, a member of the Democratic Rights Committee, told Prothom Alo, “The interim government has no jurisdiction to enter into such long-term agreements that hand over national assets to foreign control. These contracts have deep political and economic implications for Bangladesh. The people did not bring this interim government to power through the mass uprising to make such decisions.”