The capital dredging of the main channel of Payra seaport will now be implemented under the public-private partnership (PPP), officials said.
Earlier, the dredging was to be done by way of commercial financing under sovereign guarantee.
An inter-ministerial panel, led by an additional secretary of shipping ministry, is set to talk to Belgian company Jan De Nul NV (JDN) to do the job.
As the model of implementation has changed, another Belgian firm, Dredging International, recently expressed its interest to join the bidding.
An official of the company recently wrote to Prime Minister Sheikh Hasina to this end.
"In the event that the upcoming negotiations with our competitor seem to move slowly at risk of stumbling, Dredging International confirms its strong interest to participate," he said.
The government has declared the capital dredging module of the country's third-largest seaport as a national priority project.
It also agreed to provide 'payment guarantee' to get a $600-million foreign loan for this.
Primarily, the Payra Port Authority (PPA) decided that the dredging will be done by forming a joint-venture company with JDN.
Subsequently, the PPA got a seal of approval from the Prime Minister's Office to this regard.
For the loan, Hongkong and Shanghai Banking Corporation sought sovereign guarantee from the government of Bangladesh.
However, finance ministry partly agreed on sovereign guarantee since JDN will have 50 per cent share of the proposed joint-venture company.
It later agreed to provide 'payment guarantee' for the loan but decided that the dredging will be done under the PPP model, not under a joint venture.
Shipping ministry officials told the FE that Dredging International also had a discussion with the PPA two years ago to do the dredging.
At that time, the company in a memorandum of understanding (MoU) proposed that it wanted to carry out the dredging under PPP.
However, the government was adamant that the work will be done by commercial financing covered by sovereign guarantee.
It virtually put the proposal of Dredging International on ice.
Now, the firm wants to reactivate its discussion with the PPA based on the MoU it had submitted to the port authorities.
Alternatively, it seeks to participate in a competitive tender for combined dredging and financing proposals, allowing it "to submit most competitive dredging and interest rates".
Hasina on November 19, 2013, formally inaugurated Payra port for limited operation before the construction of a full-fledged port.
Shipping officials said work on the construction of the port has been divided into 19 components, with the channel dredging the most important part.
Unless the dredging is completed, other components like infrastructure and setting up of terminals cannot be started.
The power division has already requested to dredge the channel to carry coal for the 1320-megawatt thermal power plant project near the port area.
The port in Patuakhali district is set to go into full operation in 2019 to cope with the growing pressure of seaborne cargos.
According to a feasibility study done by British consulting firm Wallingford, the construction of the full-fledged port may involve $20 billion.
Of the amount, some $3.5 billion will be spent for capital dredging to make the channel navigable.
The remaining $16.5 billion will be required for establishing connectivity of the port towards Dhaka through waterways and railways, buying equipment, and building terminals and jetties.
