Private submarine cable bid in limbo despite $53m investment
Consortium warns of year-long delay and investment risk
Highlights:
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Key clearances from ministries are still pending
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Missing the April window risks a one-year delay
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The project is ready, but vessels await permission
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Private entry may break monopoly and cut internet costs
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Private investors aiming to launch Bangladesh's first privately funded submarine cable face mounting delays from inter-ministerial red tape, despite sinking $53 million (equivalent to Tk650 crore) into preparatory work.
The Bangladesh Private Cable System consortium – Summit Communications, CdNet Communications, and Metacore Subcom Ltd – awaits critical no-objection clearances from the foreign affairs and home affairs ministries, and the National Security Intelligence.
This bottleneck halts cable-laying vessels from entering Bangladesh's territorial waters.
The project links to the UMO Cable System's 2,227-km main route from Singapore to Myanmar, plus a 1,300-km branch to Cox's Bazar.
Without April approvals, investors risk missing the 31 August 2026 rollout deadline, pushing implementation back a full year due to the Bay of Bengal's narrow November-to-mid-May laying window.
In a letter sent on 31 March to the foreign affairs ministry, the consortium sought no-objection clearance for Panama- and Indonesia-flagged vessels to enter Bangladesh's territorial waters to lay the cable.
However, officials say procedural gaps between ministries have stalled progress.
A foreign ministry official, speaking on condition of anonymity, told The Business Standard that the consortium had been asked to obtain authorisation from the posts, telecommunications and information technology ministry, adding that no such communication had yet been received.
"According to protocol, one ministry cannot act on a letter issued by an agency under another ministry," the official said.
Posts, Telecommunications and Information Technology Secretary Bilquis Jahan Rimi said the ministry has not received any letter on this matter. "A decision will be announced once the letter is received."
However, official documents show that the consortium had written to the ministry in September last year seeking inter-ministerial support.
Project status
The consortium has already reached all critical technical milestones.
These include a comprehensive feasibility study, a detailed subsea route survey, the demarcation of the route from Myanmar's Exclusive Economic Zone to Cox's Bazar, and the activation of the Singapore-Myanmar segment.
The project is currently in the "shovel-ready" phase, with construction of the landing station and beach manhole progressing at full pace.
Furthermore, specialised cable-laying vessels and a team of international experts have been contracted and are awaiting final approval to proceed.
Looming deadlines
The project faces a critical "roll-out obligation" to be completed by 31 August 2026. However, technical experts note that seabed installations in the Bay of Bengal are only feasible between November and mid-May.
If the April window is missed due to the upcoming monsoon and lack of approvals, the project is feared to be delayed by at least another year, leading to massive financial demurrages.
"We have already invested nearly 50% of the total project cost," said Md Arif Al Islam, managing director of Summit Communications.
"We are stuck in a complex situation. If the government did not want private submarine cables, why were we encouraged to spend millions on infrastructure and licences?"
The consortium has already spent $53 million on licensing, VAT and other expenses. Of the amount, it has paid $43.76 million to the cable owner, Compana Pvt Ltd, for the UMO trunk cable, which includes $36 million in IRU fees and $7.96 million in maintenance charges.
Market monopoly vs competition
Currently, the state-owned Bangladesh Submarine Cables PLC controls the majority of the market through two cables, SE-ME-WE-4 and SE-ME-WE-5, with a combined capacity of 7,220 Gbps. A third state-owned cable, SE-ME-WE-6, is expected to launch next year with a massive capacity of over 40,000 Gbps at a cost of Tk1,000 crore.
Bangladesh Submarine Cables has expressed concerns that private entry will create "extreme instability" and reduce the revenue of the state-owned listed company. In a recent internal report, the company suggested that the government should set a minimum threshold to ensure state-owned cable usage does not fall below 50%.
An official from Bangladesh Submarine Cables noted that as a listed company, the government must consider the interests of its shareholders when making strategic decisions.
Entrepreneurs in the IT sector have pointed out that the provision of internet services via submarine cables is currently a monopoly held by the state-owned company. In this context, the approval of private submarine cables was a significant milestone towards increasing private sector participation, they say.
Industry stakeholders maintain a consensus that increasing private sector participation will foster a more competitive market, ultimately driving down internet costs for the public.
They argue that making connectivity more affordable will enable the inclusion of a larger segment of the population, thereby significantly boosting the country's per-capita internet consumption.
Internet penetration scenario
According to a report by the Asian Development Bank published in December last year, Bangladesh's current internet penetration stands at 53%, remaining behind regional countries like Bhutan at 88% and 85% in the Maldives; both countries show high access.
The report said Bangladesh's digital infrastructure is expanding but faces connectivity, capacity, and rural access gaps. International connectivity relies on two undersea cables, both following similar routes, creating risks, it pointed out.
