Payra Port a painful burden on economy

The Payra Port, a seaport located in the southern coastal district of Patuakhali, has become a "painful abscess" on the country's economy, Planning Adviser Wahiduddin Mahmud said yesterday.

"This port can barely function as a river port, let alone a seaport," he said at a press briefing following a meeting of the Executive Committee of the National Economic Council (Ecnec) at the National Economic Council auditorium in the capital's Sher-e-Bangla Nagar.

"After examining the site, the commerce adviser and officials concerned concluded that this is not even a river port. At best, it can be called a river terminal," he told reporters.

During the meeting, Ecnec approved a revised project proposal for the first terminal and related facilities of Payra Port, increasing the total cost by Tk 911 crore to Tk 5,228 crore.

The project's deadline has also been extended to December 2026.

"We have approved the revised project on the condition that we retain the scope to intervene at any time," Mahmud said.

"The additional funds are required not only for previous financial commitments but also for continuous dredging."

Construction of the Payra Port began in 2013, with commercial operations starting in August 2016.

The port, located on the bank of the Rabnabad channel, is also geographically important as it is in close proximity to the 1,320MW Payra Thermal Power Plant, which began operations in 2020.

Wahidduddin said the entire channel is long and extensive, and without annual dredging, even small vessels will struggle to bring coal to the power plant. Moreover, expensive dredgers will be needed every year to keep operations running.

"Our commerce adviser jokingly remarked that, given the massive annual dredging costs, it might be cheaper to transport coal by air! I have been instructed to lead a team and personally visit the site to inspect the entire project," the planning adviser said.

"Theoretically, this project was flawed from the start. But now, since a significant portion of it has already been completed, there is no easy way out."

The planning adviser further said that the Payra Thermal Power Plant project cannot be shut down. "It has already incurred massive expenses. Such a large power plant cannot simply be abandoned."

Initially planned as a deep-sea port, the Awami League government, ousted by a mass uprising in August last year following 15 years in power, later decided to develop Payra as a regular seaport.

The government prepared a master plan for the port through the Netherlands-based consulting company Royal HaskoningDHV.

To facilitate incoming ships, the government carried out capital dredging of the Rabnabad channel at a cost of Tk 6,500 crore.

However, the channel lost much of its navigability just six months later, according to a report by this newspaper in November last year.

The port handled 1,014 ships, including 123 foreign ships, in fiscal year 2023-24. Cargo handling, mostly coal for power plants, rose by 33 percent year-on-year to 50.74 lakh tonnes in FY24. The port began handling cargo in FY17, according to official data.

At yesterday's meeting, Wahiduddin also said that the interim government had made it mandatory for 100 percent of tenders to be processed digitally, up from the existing 60 percent.

Additionally, the government has eliminated the 10 percent bidding cap in the public procurement system, which previously disqualified any offer that was 10 percent above or below the quoted price in open tendering.

At the Ecnec meeting, a total of 15 projects worth Tk 21,139 crore were approved.