Japan believes that the Matarbari deep seaport will be able to catapult Bangladesh into the connecting hub of the region once it goes into full operation.
"Making use of Matarbari, Bangladesh might be placed as a regional hub that connects Northeast India and other countries in this region," Japanese Ambassador Iwama Kiminori said at a seminar at the Japanese Embassy in Dhaka.
"Bangladesh would not be a transit point, but it will surely be the driving force and main engine of regional development," he said at the seminar.
"Towards improving regional connectivity and realising the establishment of industrial value chains in the Bay of Bengal region, including Bangladesh and Northeast India".
He said the concept of developing an industrial value chain connecting the Bay of Bengal and the North Eastern Region of India will improve the connectivity of the entire Bay of Bengal region. It creates synergies by effectively linking cooperation under the "Bay of Bengal Industrial Growth Zone (BIG-B)" initiative and the development of Northeastern India.
"I wish that the discussion on connectivity might lead to new ideas for cooperation and co-prosperity among the three countries in the future," he added.
Bangladesh's business leaders also see the potential of this initiative.
Mahbubul Alam, president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), said, "Improving connectivity will give North East India access to three active seaports – Chattogram, Mongla, and Payra – and the new Matarbari deep seaport, expected to become operational by 2027.
"Considering the operational India-Japan Comprehensive Economic Partnership Agreement (CEPA) and Bangladesh's plans to negotiate a similar CEPA with India and Japan, the prospect of trilateral cooperation can boost trade and investment growth."
He also emphasised improving connectivity, infrastructure, value chains, and efficient logistics systems; physical investments in technology-driven human development; and fostering people-to-people connections to leverage this potential.
The Matarbari port is expected to be operational by 2026. The total expenditure on the three sectors, including the deep seaport, 1,200MW coal-fired power project, and transport link, will be Tk91,453 crore, 80% of which will come from Japan.
In his presentation, Debapriya Bhattacharya, distinguished fellow at the Centre for Policy Dialogue (CPD), said, "Bangladesh may become a gateway for countries and regions to its north."
Highlighting the economic prospects of the Matarbari project once it gets operational, he said, "The Matarbari deep seaport will open a direct trade corridor to Europe and the US, which will cut the export time from Bangladesh to the US from 45 days to 23 days."
"It will also attract investment and expand trade," he hoped.
Will it involve political costs?
Highlighting the geopolitical challenge, Debapriya said in his presentation, "Will it involve political costs?"
He pointed out another two challenges: geopolitical challenges involve engaging regional powers and beyond, and third-country involvement.
The economist pointed out the comparative difference in cost between the construction of the Matarbari port and two other ports in Sri Lanka. It can be seen that the cost of construction of the Matarbari deep seaport is about Tk18,000 crore.
On the other hand, Port of Colombo in Sri Lanka was built at a cost of Tk16,621 crore, and Port of Hambantota was built in 2008 at a cost of Tk1,440 crore.
Referring to the costs and the container handling capacity of the ports, he questioned, "Is Matarbari deep sea port an overpriced project?"
Additionally, Debapriya raised questions about possible difficulty in its financing, saying, "Will financing be a problem, given the emerging macroeconomic situation in Bangladesh?"
Dr Prabir De, professor at the Centre for Maritime Economy and Connectivity (CMEC) at the Research and Information System for Developing Countries (RIS), New Delhi, presented another paper.
State Minister for Foreign Affairs Shahriar Alam attended the seminar.
Hokugo Kyoko, minister (economics) of the Embassy of Japan in India, spoke, while Sabyasachi Dutta, executive director of Asian Confluence, joined virtually.