Bangladesh secured a $335.78 million concessional loan from China to upgrade Mongla Port in the southwest, located roughly 80 km from the Indian border. State-run BSS news agency reported that the financing will build two container terminals and dedicated cargo yards at the facility, which serves as the country’s second-largest seaport after Chattogram.
The Economic Relations Division (ERD) under the Finance Ministry finalised the deal with the Export-Import Bank of China on Saturday. According to the ERD statement, the funding totals 2.404 billion Chinese yuan, which equals Tk3,592.8975 crore.
China will charge a concessional interest rate of 2 per cent for this financial support. The repayment schedule spans 20 years and includes a five-year grace period. The project carries the official title of Expansion and Modernisation of Mongla Port Facilities.
This arrangement emerged from discussions during Prime Minister Tarique Rahman’s official visit to Beijing in June. Mongla Port sits on the eastern bank of the Pasur River, positioned 71 nautical miles upstream from the Bay of Bengal.
The port upgrade follows the cancellation of an Indian Economic Zone project last year. The previous interim administration led by Muhammad Yunus cancelled that project after the developer failed to start physical construction on the 110 acres of land near the port within the set deadline. India had obtained rights to that land through a 2015 bilateral agreement and appointed Evita Constructions to build the site.
India has previously expressed concerns about Beijing increasing its footprint in Bangladesh through infrastructure projects near sensitive border regions.