The land development work for the Indian Economic Zone project in Mirsharai, Chittagong, has been denied by two pre-qualified Indian contractors: Adani Ports and Special Economic Zone Limited and International Seaport Dredging Private Limited.
These two businesses received a call for bids from Bangladesh on 27th August 2023, regarding the land development project. On 28th February of this year, the corporations informed Bangladesh that they were unable to submit tenders despite having already purchased the tender documents.
The Bangladesh Economic Zone Authority (Beza) intends to renew the tender and make it available to both Indian and Bangladeshi contractors through an open bidding process in light of the challenges encountered in locating qualified Indian contractors.
Although a proposal seeking India’s approval for this change was made, India has yet to respond positively. Beza has now sent a revised project proposal with increased costs to the Prime Minister’s Office.
At a meeting on 23rd June, chaired by former Prime Minister’s principal secretary Tofazzel Hossain Miah, the project’s implementation status was reviewed.
The meeting minutes state that Beza and the Economic Relations Division were instructed by the Prime Minister’s Office to obtain permission from Indian authorities in order to allow Bangladeshi contractors to participate in the retendering procedure.
Building infrastructure on roughly 900 acres in the Bangabandhu Sheikh Mujib Industrial City is the primary objective of the Indian Economic Zone project in Mirsharai in order to draw in Indian investors. India granted US $ 115 million in principle under the third line of credit to finance the project on 11th June 2020.
The project was originally scheduled for completion by 30th June 2021, after being approved by the Executive Committee of the National Economic Council (ECNEC) in April 2019. The deadline has been moved to 30th June 2025, due to delays.
The project, with a total cost of Taka 919.85 crore, includes Taka 5.26 crore from the Government of Bangladesh and Taka 914.59 crore in project aid. As of May this year, Taka 5.98 crore has been spent, including Taka 3.43 crore from the Government and Taka 2.55 crore in project aid.
The revised proposal sent to the Prime Minister’s Office suggests increasing the project cost to Taka 2003.59 crore, with Taka 738.59 crore from the government and Taka 1,265 crore requested as project aid.
The land development work needs to be re-tendered, but it will take a long time to select pre-qualified Indian contractors via the Export-Import Bank of India’s conventional approach.
Finding qualified Indian contractors who are interested in the work is also problematic.
Bangladesh asked that Indian authorities permit Bangladeshi contractors to take part in the re-tendering procedure during the 23rd April India-Bangladesh Joint Working Committee meeting in New Delhi. India hasn’t yet consented, though.
The discussion concluded that the project plan should be revised following input from Indian authorities, and the retendering process should begin.
