Bangladesh deep-sea port ‘Matarbari’ promises strategic anchor for Japan, India

Apr 14, 2023 India Shipping News

DHAKA : A deep-sea port under construction in southern Bangladesh is shaping up to be a strategic linchpin for Japan and India as the Quad partners aim to counter Chinese influence.

Development of the port of Matarbari will put a Japan-backed facility just north of Sonadia, another prime location on the Bay of Bengal where China was expected to develop a port. That facility never materialized, and Dhaka reportedly dropped the idea a few years ago.

This is leading some pundits to declare a strategic victory for India in a South Asian great game between big powers. As India’s tag-team partner, Japan is also considered a winner in this scenario, though some observers see no game at all, only the Bangladeshi government wringing out financial assistance wherever it can.

The geopolitical importance of Matarbari — Bangladesh’s first deep-sea port — was evident during Japanese Prime Minister Fumio Kishida‘s visit to India in March. The port emerged as one of the key areas for his free and open Indo-Pacific agenda. The same month, the Japan International Cooperation Agency agreed to extend a fresh 165 billion yen ($1.2 billion) infrastructure construction loan to Bangladesh, on top of 38.8 billion yen already promised.

In New Delhi, Kishida said Tokyo would promote an “industrial value chain” from the Bay of Bengal to northeastern India in cooperation with both South Asian countries, “to foster the growth of the entire region.”

The port is being built in Bangladesh’s Cox’s Bazar district, including a container terminal and a coal-fired power plant. Deepening the harbor’s shallow waters will make room for huge container ships or tankers to dock, bringing in iron ore and exporting large quantities from Bangladesh’s garment industry.

“Matabari port will be equivalent to the Port of Colombo in Sri Lanka or Port of Singapore in terms of water depths,” said a JICA official in charge of the project.

Upon completion, expected in 2027, the complex will take a major load off of the country’s main Chattogram port, also known as Chittagong. In addition, it should serve as a key port for India’s underdeveloped northeastern states. Collectively known as the “Seven Sisters,” these states are landlocked by neighbors including China, Myanmar and Bangladesh.

Matarbari would not only be the most convenient port for the sisters but also their most prudent choice, as New Delhi is on more cordial terms with Dhaka than it is with other neighbors, analysts say. India is locked in a Himalayan territorial dispute and a regional power rivalry with China. Myanmar is ruled by a military regime at war with many of its own people — instability laid bare by a deadly airstrike on a pro-democracy gathering on Tuesday.

Japanese, Indian and Bangladeshi officials also discussed the plans on Tuesday, Reuters reported, with G. Kishan Reddy, India’s federal minister for the northeast, welcoming Japan’s initiative.

Anu Anwar, a research associate at the Fairbank Center for Chinese Studies at Harvard University, told that the Sonadia port deal with China did not succeed “because of India’s opposition, which the [government] in Dhaka could not simply override due to its overreliance on Delhi.”

But Anwar said India lacks the resources to offer an alternative to China on its own, and thus “welcomes Japan to build the Matarbari port, which seems to serve India’s interest no less than Bangladesh’s.”

Tetsuo Kotani, a professor at Meikai University in Japan, offered an explanation of Tokyo’s thinking.

“Oil is shipped from the Middle East and to Japan through the Bay of Bengal,” he said, “so the stability of the area is one of the goals Japan [has in] investing in the region.”

He added that by tightening economic relations with India by connecting the area’s infrastructure, Japan could lay the groundwork for future military cooperation.

“Any defense cooperation stems from economic ties and a network of people,” Kotani said. This week, Japan was observing Indian-U.S. air force exercises.

Japan over the past decade has significantly increased financial aid to Bangladesh, the JICA official noted. The agency says the South Asian nation accounts for 15% to 20% of Japan’s yen loans, with the money going toward roads, bridges and other civilian infrastructure projects.

When it comes to port development, Japan could hardly ask for a better spot than Matarbari — a natural gateway to both South and Southeast Asia.

“Geostrategy, much like real estate, is about location, location, location, and with Matarbari one can certainly check off that box,” said Michael Kugelman, Director of the South Asia Institute at the Wilson Center in Washington. He said Japan, Bangladesh’s biggest development partner for decades, has long been aware of the strategic significance, which is why it committed to developing a port there about five years ago.

Kugelman said Bangladesh has become a battleground for great power competition.

“China, through its infrastructure investments, has made major inroads into Bangladesh, even as India’s Modi government has strengthened ties with Dhaka. Washington has also sought to scale up ties with Dhaka in part to reduce its commercial reliance on Beijing,” he said, suggesting that Bangladesh’s geography and nonaligned foreign policy have made it a magnet for these rivals.

Indeed, China and India are even looking to fund development of different parts of the same Bangladeshi port, Mongla.

The Fairbank Center’s Anwar said the interest shown by China and Japan in building a deep-sea port astride the Bay of Bengal reflects Bangladesh’s strategic position. But he added, “Even though Bangladesh preferred Japanese investment over the Chinese in the case of its first deep-sea port,” it will not let the port become “a geopolitical pawn for one power to use against another.”

Others, like Dhaka-based South Asia analyst Adam Pitman, push back against the very notion of “monolithic states fighting over ports in Bangladesh.” Pitman called the idea “absurd.”

Instead, he said, “We are looking at many layers of Bangladesh’s government dealing with an array of financers.”

Pitman argued that Japan is a long-term investor that came in long before China took any tangible interest in the country. “Matarbari port should be seen within the context of that long-term commitment,” he said.

Ideas like Kishida’s free and open Indo-Pacific “may give that investment new impetus, but I don’t think they change Japan’s well-established trajectory here,” he added.