Bangladesh Accepts 15-Year Limit on Competing Commercial Airports Within 100km of Dhaka in Third Terminal Deal
Why It MattersA long exclusivity window for one Dhaka hub, paired with ground-handling liberalisation, shapes how much competing airport capacity and service competition the capital's aviation market can see for years.
Bangladesh has accepted four disputed provisions in a proposed concession agreement with a Japanese consortium to operate the Third Terminal at Hazrat Shahjalal International Airport (HSIA) in Dhaka. They cover revenue sharing, the contractual treatment of Biman Bangladesh Airlines, changes in law and construction defects. Bangladesh has also agreed to a 15-year restriction on commercial operations of competing civil airports within a 100km radius of HSIA. The restriction does not prevent the planning or construction of another airport or the development of military facilities.
A senior Caab official said the civil aviation and tourism ministry approved the provisions last week. Negotiations have concluded, and the revised agreement has been sent to the Japanese consortium for final review. It will then need approval from the law ministry, the finance ministry and the Cabinet Committee on Economic Affairs. Caab expects the agreement to be finalised in November; Civil Aviation and Tourism Minister M Rashiduzzaman Millat earlier said it would be signed by 15 November. Under the agreed arrangement, Bangladesh will receive 27% of the relevant revenue generated through the concession, though the full rate will not apply during the transition from partial to full operations. The transitional rate and its duration were not disclosed.
On Biman, which operates as both an airline and a ground-handling provider, the consortium sought to extend certain payment-related provisions applicable to its ground-handling operations to its airline business. A Caab official questioned this, arguing the two are separate commercial operations, but the ministry accepted the Japanese position. Aviation expert and former airline executive Wing Commander (retd) ATM Nazrul Islam criticised the 15-year condition, saying even 10 years would have been acceptable and would have allowed time to build another airport, and noting the existing runway cannot meet current demand. Caab member (administration) SM Lablur Rahman, a member of the negotiating team, said building another airport within 100km would be difficult and could take 10-15 years, and that modernisation could cut aircraft turnaround times; a further runway at the existing airport could also be explored.
The consortium has shortlisted four ground-handling companies for Caab's clearance: Çelebi Aviation (Türkiye), Menzies Aviation (UK), Swissport (Switzerland) and dnata (UAE). The selected operator will provide passenger ground handling alongside Biman, ending Biman's monopoly. Caab has insisted on a genuine equity partnership with a Bangladeshi company; the consortium has agreed to include a local partner, but its stake is undecided.
The terminal, built with support from the Japan International Cooperation Agency, has stood unused for around 22 months despite being nearly 99% complete. The government still needs Tk902 crore to make it operational, and the facility is valued at around $2.1 billion. Partial operations are targeted for 16 December. Once fully operational, the terminal is expected to raise HSIA's annual passenger capacity from around eight million to 16-22 million and add 500,000 tonnes of annual cargo-handling capacity.
