Port deals face questions on transparency, haste
They say only national interests protected only through transparent, competitive, accountable process
Two leading governance and economic-policy experts today (27 November) raised serious questions about the speed, transparency, and process behind awarding foreign operators' long-term control of major terminals at Chattogram Port.
Both experts stressed that foreign investment is essential for modernising Chattogram Port, but only through a transparent, competitive, and accountable process that protects national interests.
Debapriya Bhattacharya, distinguished fellow at Center for Policy Dialogue (CPD), said the lack of transparency is so extensive that it has created the scope to raise doubts over the government's goals.
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At a book launch ceremony titled "Economic Journalism" at the Economic Reporters Forum (ERF) auditorium in Dhaka today, he called for the cancellation of all discriminatory agreements.
Echoing similar concerns, Transparency International Bangladesh (TIB) Executive Director Iftekharuzzaman questioned the extent to which public interests had been considered and how much the agreements will actually contribute to developing local skills and capacities.
The interim government on 17 November inked two agreements, handing over two key container terminals – Laldia in Chattogram and Pangaon near Dhaka – to foreign operators, marking the first long-term lease of key port infrastructure to overseas companies in Bangladesh's history.
Under the deals, APM Terminals, part of Danish shipping giant AP Moller-Maersk, will design, build and operate the new Laldia Container Terminal for 30 years. Separately, Switzerland's inland-logistics specialist MEDLOG will manage and run the Pangaon Inland Container Terminal near Dhaka for 22 years.
Critics from political parties, economists, businesses, and port users had lodged strong opposition even before the deals were signed, arguing that the approvals were rushed and consultations were inadequate.
The weekend negotiations on 7-8 November, followed by signing on 17 November, has deepened concern that speed eclipsed scrutiny, and secrecy overshadowed the process.
Burden for next govt: Debapriya
CPD's Debapriya Bhattacharya in the book launch event said that a lack of transparency in hiring foreign operators has created a "burden" for the next government and could, in the long run, serve as a "negative precedent" for attracting direct foreign investment.
"There is no doubt about that. To enhance the country's competitiveness, especially after LDC graduation, investment will be required. Domestic investment and technical expertise are inadequate, so foreign investment is necessary; there is no issue with that," he said.
I don't think investment must be brought in within 13 days, nor should it be done under a non-disclosure agreement. It leaves one stunned.
"However, I don't think investment needs to be brought in within 13 days, nor do I think it should be done under a non-disclosure agreement," he added.
Debapriya said, "The overall lack of transparency is so extensive that it raises doubts for you and your beneficiaries. The whole process has created a burden for the next government. There is a fear that, in the end, it could become a 'negative precedent' for attracting direct foreign investment."
Highlighting the quick hiring of foreign operators despite delays in implementing recommendations from the Media Reform Commission and other bodies, he remarked, "In one area, the government did nothing, but in another, it completed such a large task within two weeks. It leaves one stunned."
"This shows that it can be done. Then why not elsewhere? This question will repeatedly arise in our minds. It indicates a lack of political intent somewhere and insufficient incentives for proper implementation," he added.
He added that "good work cannot be sustainable unless done correctly, transparently, and in compliance with regulations. I faced ten different questions during this process, and I do not have all the answers."
He called for the cancellation of all discriminatory agreements. "Among the three port contracts, one started under the previous government. We did not fully examine its transparency. The government did not disclose how the DP World contract was made," he said.
Secrecy risks public trust: Iftekharuzzaman
Iftekharuzzaman in his statement urged the government to disclose "all information, conditions, and procedures" of the new terminal agreements. He said foreign investment in Chattogram Port Authority could yield positives, but secrecy around long leases risks public trust.
The unusually rapid pace of the deals create a reasonable basis for questioning the entire process. Therefore, a clear explanation is needed.
"We welcome efforts to attract foreign direct investment for port development and economic growth," he said. "But the public must know how national interests were protected in these long-term deals."
He further said, "Has an analysis been conducted on the port-centred employment and the positive and negative impacts on various related institutions and stakeholders? Overall, to what extent have the interests of the public been considered, and how much does this agreement contribute to developing local skills and capacities in this sector?
"Moreover, is there a clear economic strategic roadmap that formed the basis of the government's decision to sign this long-term agreement? Since the government has already signed the agreement, answers to these questions related to national interest must be promptly disclosed to the public in the interest of transparency."
He said the International Finance Corporation, transaction adviser on the APM Terminals deal, projected 62 days to complete ten major steps after proposal submission.
Instead, evaluations, negotiations, board meetings, ministry approvals, and the letter of award were wrapped up "within two weeks".
He said the deals were completed at an unusually rapid pace. "This creates a reasonable basis for questioning the entire process. Therefore, a clear explanation from the government on this matter is imperative."
He added, "Moreover, if the Pangaon terminal agreement was conducted through a competitive process, then what was the rationale behind adopting an exceptional process in the case of Laldia? We call on the government to clarify this as well."
He further pressed on economic risk. He asked whether remedies, liabilities, and lessons from long leases in comparable developing economies informed the decision. He also asked what the state gains relative to operator profits.
He said any cost–benefit analysis, and projected financial gains or risks for citizens, remain undisclosed. "The government must publicly clarify its position to ensure transparency and accountability," he said.
