The Civil Aviation Authority of Bangladesh (CAAB) has asked the Japan government to conduct a financial assessment of how the latter's revenue sharing with Bangladesh will be viable if it is entrusted with the job to operate the Dhaka airport's third terminal.
Japan has made a proposal to get the contract to operate and maintain the terminal, which is under construction with major funding from the Japan International Cooperation Agency (Jica), through the Public Private Partnership (PPP) under the government-to-government modality.
The Bangladesh government also gave a positive indication to Japan authorities instead of going for an open tender.
During Prime Minister Sheikh Hasina's visit to Japan in the last week of November, the issue of awarding the terminal's operation to the country will get priority in the agenda, according to sources at the civil aviation and tourism ministry.
A delegation of government high-ups, led by prime minister's Principal Secretary Ahmad Kaikaus, visited Japan this month at the invitation of the Japan's Ministry of Land, Infrastructure, Transport and Tourism.
Secretary to the civil aviation ministry Md Mokammel Hossain, who was part of the visiting team, met with 10 Japanese companies having experience in airport operation. They are IHI Corporation, Japan Airport Terminal Company, JFE Engineering Corporation, Narita International Airport Corporation, TAISEI Corporation, Sumitomo Corporation and some others, according to aviation ministry sources.
The PPP Authority asked those companies to submit an expression of interest, said a ministry source.
State minister for civil aviation and tourism Md Mahbub Ali said Japan is pursuing the government for getting the third terminal's operational contract. Many other foreign companies, including Dnata and Swissport International Ltd, also showed interest.
As Japan is interested, the issue may feature in the agenda during the prime minister's visit, he also said.
He said the PPP authority will appoint a transaction adviser to conduct a financial assessment of the proposals to see whether the revenue sharing with the government will be viable.
The total construction cost of the third terminal under the Hazrat Shahjalal International Airport Extension Project amounts to Tk21,300 crore, of which Tk16,300 is financed by Jica and the remaining Tk5,000 crore by the government.
The new passenger terminal is expected to be partially open in October next year but the government is yet to finalise the process of airport operation and management.
Usually, the process to outsource airport services and management takes more than two years.
When the CAAB started the process to accept applications for ground handling and passenger services at the Dhaka airport, Japan showed interest in getting the contract, said Air Vice Marshal M Mafidur Rahman, chairman of the CAAB.
"We asked them to conduct a financial analysis of how much revenue they can generate and how much revenue they can share as the CAAB will pay off its loan from the income it gets through the airport operation," he said.
He said the process of outsourcing the airport management will take two years. The government will go for a service contract primarily, which is a six-month process with only one year in hand before soft opening of the airport, he added.
The new international passenger terminal building is set to have a floor area of around 2.25 million square feet whereas the existing two terminals of the Dhaka airport have a space of around 1 million square feet together.
The airport's expansion is expected to increase its annual passenger handling capacity from the current 8 million to approximately 20 million, and the cargo capacity from 200,000 tonnes to 500,000 tonnes.
It will have 115 check-in counters, including 15 self-service, 66 departure immigration counters, including 10 automatic passport control counters, 59 arrival immigration desks, including five automatic check-in counters and 19 check-in arrival counters, while 16 arrival baggage belts will be set up.
According to the project design, the third terminal will have 12 boarding bridges and conveyor belts each.