Govt to develop container terminal-1 at Payra Port under PPP

The government will develop the container terminal -1 at the Payra Port under the Public Private Partnership.

The decision was made at a meeting of the Cabinet Committee on Economic Affairs (CCEA) on 20 March with Finance Minister Abul Hasan Mahmud Ali in the chair.

According to official sources, the CCEA has given its nod in principle to a proposal by the Payra Port Authority (PPA). The Ministry of Shipping placed its subordinate body’s proposal at the CCEA meeting.

The CCEA has been the highest authority in approving any unsolicited offer in purchases by the government.

Sources said that after such approval, now the PPP Authority will invite interested international companies to place their expression of interests to implement the project.

Payra Port was constructed in 2013 in Patuakhali district of the country and authorities are trying to expand its activities.

It is the country’s third largest seaport, after the Chattogram Port and the Mongla Sea Port, and handles a significant portion of Bangladesh’s international trade.

Officials said that the main goal behind establishing the port was to reduce the burden on the overcrowded Chattogram Port and improve the country’s transportation infrastructure.

About the development of the container terminal – 1, the PPA Authority in its official websites mentioned that there are some objectives behind the project.

These include providing a major gateway for the country's trade with the outside world, improving the quality of services and developing adequate facilities and decreasing the pressure on the existing ports and  enhancing competitiveness of the country’s exports as prices of imported and exported commodities decrease as a result of shorter shipping time and lower shipping costs.

“Exporters would incur lower financial costs for their shipments due to the shorter processing and shipping time for their cargo,” it said.

The PPP Authority also mentioned Bangladesh has a vast coastline and in spite of that there are only two sea ports, and with the increased demand in sea-centric trade, congestion is quickly becoming an issue.

Officials said the Ministry of Shipping has also decided to develop five components of the Payra Port through Public-Private Partnership modality.

Shipping Industry insiders said that one of the major advantages of the Payra Port is its location, which is convenient for the movement of cargo to and from the southwestern region of Bangladesh. This is one of those five.

The port is also well connected to the country’s transportation network, with road, rail, and waterway links to other parts of the country, they said.

They said that in recent years, the Payra Port has undergone a number of expansion and modernization projects to improve its infrastructure and efficiency. One such project is the construction of a new container terminal, which will increase the port’s capacity to handle 1.5 million twenty-foot equivalent units (TEUs) per year.

They also mentioned the Payra Port still faces a number of challenges as well.

They said one of the major challenges is the limited capacity of the port, which often leads to congestion and delays in the movement of cargoes.

The port is also struggling to compete with other regional ports, which have more advanced infrastructure and facilities, said a user of the port.

Another challenge for the port is that it has been also facing environmental concerns as it is located in an ecologically sensitive area, and there are concerns about the impact of its operations on the local ecosystem, they said.