Govt targets Dec opening of Dhaka airport's 3rd terminal but Japanese consortium wants 2 more months

Infographic: TBS

Already facing a year-long delay, the government aims to make Dhaka airport's new third terminal operational by year-end. However, the Japanese consortium set to secure the operation and maintenance contract is seeking two more months to prepare.

The Civil Aviation Authority of Bangladesh (CAAB), however, remains committed to launching the terminal's full operations by December this year, despite this new hurdle.

Negotiations with the Japanese consortium are ongoing and a contract is expected to be signed by June this year, said CAAB Chairman Air Vice-Marshal Md Monjur Kabir Bhuiyan. 

"After minimal negotiations, they have asked for six to eight months to prepare. We told them that we can't give them more than five or six months," he told The Business Standard.

The third terminal of the Hazrat Shahjalal International Airport was given a soft launch by Sheikh Hasina on 7 October 2023, with full operations promised by 2024. 

However, political changes in the country, frequent changes in project leadership, and delays in receiving some materials from abroad, particularly those required for the VVIP terminal, have pushed back the timeline.

"Our work at the third terminal is almost done, with only some work pending in the VVIP terminal," Bhuiyan said. "This should be completed by June or July, as there were some contractual complications."

He added, "After taking charge, I needed some time to streamline everything within the system. Work is proceeding according to regulations now, but since some materials must come from abroad, it's taking a little longer."

He added, "Our target is still to complete everything by December. If we absolutely can't, that's a different issue, but we're doing our best."

The ousted Awami League government had earlier decided to operate and maintain the third terminal under a public-private partnership with the Japanese consortium. 

The consortium – comprising Japan Airport Terminal Company, Sumitomo Corporation, Sojitz, and Narita International Airport Corporation – will handle operational activities, while CAAB will be responsible for security.

The Japanese partners will need to recruit and train manpower after signing the agreement.

"They have to test every piece of equipment to ensure it's robust and running smoothly – from baggage handling systems to scanning machines and explosive detection systems. Each must be run for a certain period to confirm their performance," Bhuiyan explained.

"They will conduct the trial runs, and we will monitor them. The final agreement will be a concession agreement between me and the consortium. It will take some time, but after that, when everything is operational, we will start full operations," he said.

Biman Bangladesh Airlines will handle ground services for the next two years under the supervision of the Japanese company, with a separate service-level agreement in place. Data security will remain under CAAB's jurisdiction.

As per the pre-bid discussions, major revenue from the terminal's operations will be shared with CAAB, while the Japanese consortium will receive a portion for their maintenance work.

The final revenue-sharing ratio will be determined after receiving the request for proposal (RFP) and completing negotiations, according to the CAAB chairman.

Once operational, the new terminal will boost the airport's passenger capacity from 8 million to 12 million annually. It will also significantly expand cargo capacity – up to 273,470 tonnes for imports and 546,941 tonnes for exports.