Bangladesh’s bold port plan: Can foreign management deliver growth without compromise?

As Bangladesh strives to become a trillion-dollar economy, Chittagong Port, handling 92% of the nation's international trade and 98% of container traffic, stands as the country's economic lifeline. The interim government, led by Chief Adviser Muhammad Yunus, is currently negotiating with Dubai-based DP World to manage the New Mooring Container Terminal (NCT). 

This move aims to address chronic inefficiencies and drive modernisation, foreign direct investment (FDI), and job creation. However, political parties, workers, and civil society groups, including Ganosanhati Andolan, are raising significant concerns about national sovereignty, transparency and local livelihoods. 

The central question remains: Can Bangladesh effectively harness global expertise while assuaging these fears, or will this ambitious plan falter under intense public scrutiny? 

A strategic push for modernisation 

The primary merit of involving a foreign operator like the Dubai-based global logistics giant DP  World lies in its potential to significantly enhance the port's efficiency, capacity and overall competitiveness. 

The port's current ranking of 337th out of 405 global ports, according to the  World Bank, underscores its inherent challenges, which collectively cost the economy hundreds of millions of dollars annually. This burden is particularly acute for the vital garment industry,  which accounts for 80% of exports and 10% of the nation's GDP. 

Globally, public-private partnerships (PPPs) in port management have a proven track record of success in reducing cargo dwell times, increasing throughput, and lowering trade costs. DP World,  which manages high-performing facilities like Jebel Ali in the UAE (handling 13.5 million TEUs annually), has proposed a substantial $1 billion investment to modernise NCT, upgrade equipment, and alleviate congestion. 

At the 2025 World Economic Forum, Chief Adviser Yunus explicitly invited DP World and AP Moller-Maersk to submit proposals, articulating a vision for  Chittagong to evolve into a world-class hub. PPPs, exemplified by Singapore's PSA International (contributing 7% of Singapore's GDP), are considered pivotal to realising this vision. 

The  Bangladesh Navy's interim management of NCT, which commenced on 07 July 2025, following the expiry of Saif Powertec's contract, provides a critical six-month window to finalise terms with DP  World, with mediation by the International Finance Corporation (IFC). 

Promised benefits: FDI, forex reserves, and jobs 

The proposed management handover of NCT to a global operator like DP World represents a strategic response to Bangladesh's pressing economic and structural challenges. With foreign  exchange reserves standing at $30 billion as of 16 July  2025 (with net usable reserves at $25 

billion as per the IMF's BPM6 standard), DP World's planned $1 billion investment could significantly help stabilise reserves and bolster macroeconomic confidence. 

Moreover, the potential impact on foreign direct investment (FDI) is substantial. Bangladesh attracted approximately $3 billion in FDI in 2023, representing a modest 0.75% of GDP. DP World estimates that its involvement could catalyse a six-fold increase in FDI, drawing parallels to  Vietnam's remarkable port-centric FDI boom, which reached $20 billion in 2022. 

With improved infrastructure, enhanced transparency, and greater predictability in logistics, Bangladesh could emerge as a far more attractive destination for global investors, particularly in its thriving manufacturing and export-driven industries. 

Operational efficiency is another critical area for gain. World Bank estimates indicate that persistent delays and inefficiencies at Chittagong Port—notably prolonged container dwell times—have consistently acted as a significant bottleneck for trade. 

The introduction of modern port management practices, state-of-the-art equipment, and advanced technology by DP World could drastically reduce dwell time, bringing it closer to global standards. This improvement could potentially lead to a 15% increase in overall export volume, directly supporting reserve accumulation and contributing to a healthier national balance of payments. 

From a socio-economic perspective, the initiative also holds promise for addressing the nation's concerning youth unemployment rate, currently at 16.8%, with nearly one-third of the youth population classified as NEET (Not in Education, Employment, or Training). 

DP World's commitment to local workforce development—encompassing comprehensive training and upskilling programs—is slated to be a mandated component of the PPP agreement. Similar efforts by A P Møller Terminals in Apapa, Nigeria, successfully upskilled 2,000 local workers, setting a positive precedent for skill development. Beyond direct employment, the economic multiplier effects are substantial. 

Enhanced port infrastructure is anticipated to generate a multitude of indirect jobs across various sectors, including logistics, manufacturing, warehousing, and textiles—all industries critically dependent on seamless port operations. The success of Jebel Ali  Port in the UAE, which anchors a broader industrial ecosystem supporting over 90,000 jobs,  serves as a powerful example of a modern port's far-reaching economic impact. 

The planned expansion of Chittagong Port's capacity to 10 million TEUs by 2032 could further unlock significant economic value and create thousands of new jobs, reinforcing Bangladesh's ambition to become a regional manufacturing and export hub. 

Opposition's concerns: Sovereignty, transparency, and more 

Opposition to foreign management of Chittagong Port is long-standing, resurfacing after similar resistance in March 2023 when the Awami League government considered leasing NCT to a foreign operator. Most political parties, along with alliances like Desh Bachaw Poribesh Bachaw (Save the country, save the environment), oppose the move.

Critics argue local management by the Chittagong Port Authority (CPA) and Saif Powertec is sufficient, citing 2024's record performance: 3.3 million TEUs processed, Tk5,056 crore in revenue (up 21.4%), Tk2,949 crore in net profit, and a recent Tk18,000 crore investment approval. Ganosanhati Andolan and the Ganatantrik Odhikar Committee warn that foreign control could threaten sovereignty, as NCT lies next to a major naval base. They point to the 2006 US rejection of DP World's port deal over security concerns as a cautionary precedent.

Social media (notably X) speculates about DP World's alleged US Navy ties, raising fears of entanglement in India-China rivalries, given China's port interests in Bangladesh and recent Indo-Bangladesh strains under Yunus's interim government.

Transparency is another concern. Critics oppose government-to-government arrangements without open bidding, especially under a non-elected government. Zonayed Saki of Ganosanhati Andolan likens the secrecy to the unpopular 2024 Patenga Terminal deal with Red Sea Gateway Terminal (RSGT).

Public distrust is reinforced by Bangladesh's low Corruption Perception Index ranking—151/180 in 2024, its worst in 13 years and second-lowest in South Asia. This sentiment drove the June 28, 2025, road march and protests by left-leaning parties. Workers, in a job market with 2 million annual entrants, fear automation-related job losses, citing examples like Singapore's ports. Geopolitical risks, including India's stakes in Mongla and Payra ports, further complicate the decision.

Balancing benefits and concerns 

While critics point to current profitability, the port's operational inefficiencies make a strong case for external expertise. Chittagong's vessel turnaround time of 4–7 days far exceeds the global benchmark of under 24 hours, driving up logistics costs and congestion surcharges. Its average container dwell time of 11 days—over triple the global standard of 3—reflects severe clearance delays. 

Crane productivity, at 20–25 moves per hour, lags the 40-move benchmark, while a 90% berth occupancy rate (vs. under 70% globally) signals chronic congestion, worsened by monsoon disruptions. These inefficiencies contribute to its 337th global ranking by the World Bank and cost the economy hundreds of millions annually; improvements could save up to $500 million per year.

To secure benefits while addressing concerns, the government can adopt safeguards:

Sovereignty and security: A joint venture model with the Chittagong Port Authority (CPA) retaining majority control (e.g., 51%, as in Jeddah's RSGT) can protect national interests. Navy-led protocols, restricted access around NCT's naval base, and real-time monitoring—similar to Karachi Port oversight—can address security fears. A transparent MoU can formalise CPA's oversight and limit foreign operational control.

Transparency and trust: Public disclosure of full contract terms, regular forums with workers, unions, and civil society, and proactive outreach via media—as in Apapa, Nigeria—can rebuild trust. IFC mediation can ensure globally compliant negotiations with timelines and performance benchmarks.

Local capacity and employment: Mandating technology transfer and training, as in Apapa (2,000 workers trained), and local hiring quotas of at least 70%, as in DP World's Qasim terminal, can build expertise and ease automation fears. Partnerships with institutions like the Bangladesh Marine Academy could train thousands in digital logistics and crane operations. Profit-sharing models, like Port Klang's reinvestment of net profits, could directly benefit Bangladesh's economy and the 4 million garment jobs reliant on efficient port operations.

Geopolitical neutrality: Positioning DP World as a neutral partner, leveraging the UAE's balanced ties with China and India, can help Bangladesh navigate rivalries. Public diplomacy can reinforce the project's economic focus. The Bangladesh Navy's interim NCT management and BIDA reforms (e.g., Project Ambassador) can boost investor confidence despite Bangladesh's 168/190 ease-of-doing-business ranking. Collaboration could also curb financial irregularities, for which evidence exists.

A pivotal moment: Ports have driven transformations in Dubai and Singapore. The UAE-Bangladesh partnership, backed by past MoUs, offers a solid base for this venture. With prudent oversight, private capital can drive progress. DP World's expertise could lift Chittagong's ranking, save hundreds of millions annually, and enhance competitiveness. But inclusive governance is vital—recent events like the June 2025 customs strike (€200 million daily loss) and ongoing protests show the risks of neglecting stakeholders. Transparent engagement on sovereignty, transparency, and local jobs can harness FDI benefits, strengthen reserves, and safeguard employment. 

Without this, backlash like that at Patenga Terminal could recur. Well-structured PPPs could turn Chittagong into a dynamic regional hub, fostering inclusive growth for 170 million people and proving that bold partnerships can deliver prosperity without compromise.

Hussain Samad (hsamad2000@yahoo.com) is an independent researcher and consultant at the World Bank in Washington, DC. 

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard