Economy
Ship purchase, trade support to dominate PM’s crucial China visit
Bangladesh is set to sign agreements with China to procure four large ships including two crude oil mother tankers with Chinese loans during Prime Minister Sheikh Hasina’s upcoming visit to Beijing.
Experts describe the trip as crucial for the country’s regional geopolitics and for maintaining developmental momentum amid economic challenges.
Officials say incorporating these vessels, which also includes two mother bulk carriers for transporting coal, food grains, cement clinkers, and other goods into Bangladesh’s existing fleet, will reduce the country’s dependency on foreign ships for transporting highly sensitive products such as fuel oil.
During the prime minister’s visit, scheduled for 8-11 July, an announcement is expected regarding a trade support package from Beijing in Chinese currency, equivalent to $5 billion, with an interest rate of 1% and a grace period of 20 years.
The Bangladesh Shipping Corporation (BSC) will purchase the ships using financing from trade support at a cost of 1,676.54 million Yuan, which is around Tk2,486 crore.
The government anticipates receiving around $20 billion in funding from China across multiple sectors during the visit, with a significant portion allocated to various development projects.
$2b budget support, CEPA commencement and more
During the Prime Minister’s visit, an announcement may be made regarding China providing reserve support or budget support to Bangladesh, as stated by Chinese Ambassador to Dhaka, Yao Wen. Sources indicate that Bangladesh has requested $2 billion in budget support from China.
Additionally, there could be announcements about the official commencement of the Comprehensive Economic Partnership Agreement (CEPA), along with initiatives related to bilateral trade and investment, the construction of a metro rail, development projects in the southern region including Payra Port, and securing Chinese loans for Bangladesh’s infrastructure development.
According to sources, around 17 Memorandums of Understanding (MoUs), agreements, or letters of intent may be exchanged across various sectors during the visit.
Additionally, Prime Minister Sheikh Hasina and Chinese President Xi Jinping will officially inaugurate several projects in Bangladesh completed with Chinese funding. These include the 1320 MW coal power plant by S Alam Group and the Single Point Mooring with Double Pipeline project.
The Bangladesh Bank may also sign an MoU with China’s National Financial Regulatory Administration to initiate trade in Taka-Yuan.
Mother tankers to transport fuel to single point mooring
Officials from the Bangladesh Shipping Corporation (BSC) said the ships will be purchased with a loan from the Chinese Exim Bank for 20 years with a five-year grace period at an interest rate of 2%. The China National Machinery Import and Export Corporation will supply them.
Each crude oil mother tanker has a capacity of 114,000 deadweight tonnage (DWT), while the mother bulk carriers have a capacity of 81,500 DWT. The construction period for the ships is estimated to be 32-34 months.
A senior BSC official, who wished to remain anonymous, told the news reporter that all the processes for purchasing these four ships with Chinese financing have been completed. A formal agreement signing or announcement in this regard may occur during the prime minister’s visit.
Commodore Mahmudul Malek, managing director of the Bangladesh Shipping Corporation, said the Economic Relations Division (ERD) will sign the agreement on behalf of Bangladesh. The construction of the ships will commence immediately after the contract signing and they are expected to be delivered within two years.
Regarding the crude oil mother tankers, he said the mother tankers will transport oil near the Single Point Mooring with Double Pipeline Project.
Each crude oil mother tanker will cost Tk780.84 crore. The import cost of each mother bulk carrier is Tk462.31 crore.
According to BSC officials, the ships will transport around 20 lakh tonnes of crude oil and 15.2 lakh tonnes of cargo annually.
The BSC currently does not have such large mother tankers. Officials say the government aims to ensure Bangladesh’s fuel supply by transporting crude oil using these new ships.
Previously, the BSC purchased three product oil tankers and three bulk carriers with a loan of Tk1,500 crore from China, which were added to the BSC’s fleet in 2018 and 2019.
MoU on infrastructure and construction
Furthermore, an MoU on Deepening Cooperation in Infrastructure and Engineering Construction is scheduled to be signed between Bangladesh’s Economic Relations Division and China’s Ministry of Commerce during the prime minister’s visit.
Additionally, the Economic Relations Division (ERD) may sign a separate MoU with the China International Development Agency to join the China-led Global Development Initiative. The ERD will also sign another MoU with this Chinese organisation regarding the implementation of the 9th Bangladesh-China Friendship Bridge Project in Bangladesh, funded by China.
A joint statement by the two leaders is expected to announce the completion of the joint feasibility study for the Comprehensive Economic Partnership Agreement (CEPA) and the commencement of bilateral negotiations. Negotiations for the China-Bangladesh Bilateral Investment Treaty are also set to begin.
Announcements regarding the implementation of the sewage collection system under the Dasherkandi STP catchment project for Dhaka city, along with projects for water supply, sanitation, drainage, solid waste management, and faecal sludge management in municipalities funded by China, may be made during the visit.
Additionally, it is anticipated that the two leaders may jointly inaugurate the Modernisation of Telecommunication Network for Digital Connectivity project.
“Primarily national interest”
Shahab Enam Khan, professor of international relations at Jahangirnagar University, said the prime minister’s visit to China is primarily driven by national interests.
“Essentially, economic considerations outweigh geopolitical issues during this tour,” he said.
He, however, added, “Maintaining political balance between the US, China, and Myanmar is also a key aspect of the visit. The Rohingya crisis poses a security threat to the region, prompting Bangladesh to seek China’s assistance in resolving this issue.”
Shabab Khan further said during the visit, the highest priority is being given to forex stability, deferred payment arrangements, and budgetary support. Natural resource management is also a key focus area.
“The government is particularly seeking China’s assistance in managing Bangladesh’s internal water resources. This includes not only the Teesta River but also overall inland water management,” he explained.
Professor Shahab Enam Khan said, “The government aims for Chinese funding to enhance Bangladesh’s infrastructure. This development is not only beneficial for Bangladesh itself but also aims to accelerate infrastructure projects funded by China to improve connectivity with neighbouring countries.”
He further said, “Bangladesh anticipates China’s cooperation in enhancing digital connectivity. Technology transfer from China and Chinese investments will be crucial during the prime minister’s visit. China plays a pivotal role as a development partner coordinating overall development efforts in Bangladesh.”
The newest tranche of US funding will assist Bangladesh towards a more inclusive, equitable and democratic course for its people, the US Embassy in Dhaka said today (16 September).
According to the embassy, from 2021-2026, USAID has committed nearly $1 billion to help improve the lives of the Bangladeshi people.
During the US delegation’s visit yesterday (15 September), USAID signed a development agreement worth over $200 million with the interim government to support Bangladesh in advancing development, strengthening governance, expanding trade, and creating greater opportunities for the Bangladeshis to build a brighter and more prosperous future.
The officials discussed ways to support inclusive economic opportunities for the people of Bangladesh, ensure financial stability, and strengthen democratic governance.
The US interagency delegation held meetings with key advisers for the Bangladesh interim government, including Chief Adviser Prof Muhammad Yunus, Foreign Affairs Adviser Touhid Hossain, and Finance and Commerce Adviser Dr Salehuddin Ahmed yesterday.
The US delegation included Department of Treasury Assistant Secretary Brent Neiman, Assistant Secretary of State for the Bureau of South and Central Asian Affairs Donald Lu, USAID Deputy Assistant Administrator for Asia Änjali Kaur, and Assistant US Trade Representative Brendan Lynch.
Bangladeshi landowners are set to regain around 200 acres of land that had shifted into Indian territory due to the erosion of the Padma River along the Daulatpur border in Kushtia. This decision followed a joint agreement reached during a meeting between the Border Guard Bangladesh (BGB) and India’s Border Security Force (BSF) on Sunday.
The land in question, situated in the Challishpara area of Ramkrishnapur union, became disputed due to the shifting course of the Padma River and natural disasters, which disrupted boundary markers over a three-kilometer stretch. The issue was first identified in a survey earlier this year.
Lieutenant Colonel M Mahbub Murshed Rahman, commander of BGB’s 47th Battalion, confirmed the decision to resurvey the area and return the land to its rightful owners. A survey on February 10 revealed that approximately 200 acres of Bangladeshi land had ended up inside Indian territory, while 40 acres of Indian land were found in Bangladesh.
Both countries plan to officially correct the boundaries in October, following the resurvey. Sunday’s meeting, held at the Jamalpur Border Outpost, also addressed broader issues like preventing border killings and tackling drug trafficking.
Lt Col Rahman stressed that no one will be allowed to use the disputed land until the resurvey is complete. He also expressed Bangladesh’s strong opposition to recent border killings, urging the BSF to prevent the detention of innocent citizens and curb illegal cross-border activities, especially ahead of Durga Puja.
The holy Eid-e-Miladunnabi, commemorating the birth and demise of Prophet Hazrat Muhammad (PBUH), is being observed across Bangladesh today with profound religious reverence. The observance was confirmed during the National Moon Sighting Committee’s meeting on September 4, held at the Islamic Foundation’s Conference Room in Baitul Mukarram National Mosque. The meeting was chaired by the Secretary of the Ministry of Religious Affairs, Md Abdul Hamid Jamaddar, as announced in a press release.
The committee confirmed that the moon of Rabiul Awal 1446 Hijri was sighted in the sky of Bangladesh on September 4, marking the beginning of the holy month of Rabiul Awal from September 5 (Thursday).
On this day in 570, Prophet Muhammad (PBUH) was born in Makkah, Saudi Arabia, bringing divine blessings and messages of peace to humanity. He passed away on the same date, 12th Rabiul Awal, of the Hijri calendar.
In honor of the occasion, President Mohammed Shahabuddin and the Chief Adviser to the interim government, Prof Dr Muhammad Yunus, issued separate messages, extending greetings to the people of Bangladesh and Muslims worldwide.
To mark the day, Bangladesh Television (BTV) and Bangladesh Betar are airing special programmes, while various national newspapers have published supplements underscoring the significance of the event. The day is also observed as a public holiday throughout the country.
