Bangladesh has signed a $335.78 million concessional loan agreement with China to expand and modernize Mongla Port in the country’s southwest on Monday.
The funding will support the construction of two container terminals and dedicated cargo-handling yards at Mongla, Bangladesh’s second-largest seaport after Chattogram. The project aims to increase the port’s capacity and improve its infrastructure.
As reported by the state-run BSS news agency, the agreement, worth 2.404 billion Chinese yuan or Tk 3,592.8975 crore, was signed on Saturday between the Bangladesh government and the Export-Import Bank of China. Under the terms of the agreement, China will provide the loan at a concessional interest rate of 2%, with a repayment period of 20 years, including a five-year grace period, according to the Finance Ministry’s Economic Relations Division (ERD).
The Economic Relations Division signed the agreement with China’s Export-Import Bank on behalf of both parties for the “Expansion and Modernization of Mongla Port Facilities” project, according to the statement.
The agreement comes a year after the Muhammad Yunus-led interim government scrapped an Indian Economic Zone project planned on 110 acres near Mongla Port. The government cited the failure of the Indian government-nominated developer to begin physical construction within the stipulated deadline.
The loan deal also builds on commitments made during Prime Minister Tarique Rahman’s visit to Beijing in June, when Bangladesh and China reached an understanding on the project.
Alia Meher, joint secretary of Bangladesh’s Economic Relations Division, signed the agreement on behalf of the Bangladesh government, while Fengjun Tian, assistant general manager of China’s Export-Import Bank, signed it on behalf of the Chinese side.
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