Japan proposes industrial hub in Bangladesh with supply chains to India

Japan proposes industrial hub in Bangladesh with supply chains to India

Japan has proposed the development of an industrial hub in Bangladesh with supply chains to landlocked northeastern states of India, Nepal, and Bhutan beyond by building a port and transport in the region. The proposal was touted after the visit of Japanese Prime Minister Fumio Kishida to India last month, to bolster development in the impoverished region of 300 million people.

Following Kishida's visit, the Japanese government approved $1.27 billion in funding to Bangladesh for three infrastructure projects, including a new commercial port in the Matarbari area with links to adjacent landlocked Indian states such as Tripura, and wider international markets. The deep-sea port is expected to be operational by 2027 and will be key to building an industrial hub connecting the Bangladeshi capital Dhaka to landlocked areas of India.

At a meeting of Indian, Bangladeshi and Japanese officials in the Tripura state capital, Japanese Ambassador to India Hiroshi Suzuki cited the industrial hub proposal, calling it a win-win plan for India and Bangladesh. G Kishan Reddy, India's federal minister for its northeast region, welcomed the Japanese initiative, while Bangladeshi Minister of State for Foreign Affairs Shahriar Alam said it would boost Indian-Bangladeshi trade and help bring in Japanese and other foreign investments.

Sabyasachi Dutta, head of Asian Confluence, a think-tank that organized the two-day meeting, said that the proposed seaport is about 100 kilometres (62 miles) from the Tripura state and could prove a gateway for regional exporters. The envisaged Matarbari project will be Bangladesh's first deep-sea port capable of hosting large vessels.

India and Japan are jointly developing infrastructure projects across Bangladesh, Sri Lanka, and Africa as an alternative to China's multibillion-dollar Belt and Road Initiative to counter the spreading of Chinese influence. More than 300 Japanese companies are already operating in Bangladesh. Both countries are expected to sign an economic partnership agreement soon, which could further boost manufacturing and attract more foreign companies, said Suzuki.