Japanese consortium negotiations collapse as CAAB faces mounting repayment obligations on JICA-funded facility with expired warranties and zero revenue

Third terminal at Hazrat Shahjalal International Airport remains stalled despite TK 15,000 crore loan from Japan International Cooperation Agency, with Bangladesh facing mounting repayment obligations while facility generates no revenue.

Civil Aviation Authority of Bangladesh and Japanese consortium failed to reach agreement after two-day negotiation session in late November. Talks collapsed over fundamental disagreements on revenue sharing model and operational structure for managing the facility.

Japanese group rejected CAAB's proposed India-style income-expenditure model, stating it is incompatible with international-standard terminal operations. CAAB refused to share revenue from major income sources including passenger fees and commercial profits, which consortium says makes project financially unviable.

Construction of terminal is virtually complete, but facility remains largely idle without signed operator agreement. Terminal was originally scheduled to open in December 2024. Revised target of end of 2025 has also passed amid prolonged deadlock.

Bangladesh must begin repaying TK 15,000 crore JICA loan despite terminal generating zero operational revenue. Substantial portion of equipment installed at facility is nearing or past warranty expiry, potentially escalating future maintenance costs significantly.

Government officials are now considering reopening international tender to find new operator. CAAB has informed Civil Aviation Ministry and Public-Private Partnership Authority of situation as alternative solutions are explored.

Industry analysts warn financial risks are mounting with each passing month. Equipment degradation and expired warranties will require additional investment before terminal can become operational. Meanwhile, loan repayment schedule continues regardless of facility's idle status.

Terminal was designed to triple annual passenger capacity at HSIA and expand cargo handling capabilities. Aviation sector observers describe facility as strategically vital for Bangladesh's aviation growth and regional connectivity goals.

Without swift resolution, benefits of expanded capacity will be further postponed during period of growing passenger demand. Dhaka airport continues operating without increased capacity amid rising regional competition from neighbouring countries.

Delayed launch means Bangladesh is missing potential revenue from terminal operations, commercial activities and increased passenger throughput. Economic returns that justified original TK 15,000 crore investment remain unrealized.

Financial burden accumulates as unused terminal sits complete but non-operational. Each month of delay adds to overall project cost while generating no income to offset JICA loan obligations that Bangladesh must honour regardless of operational status.