Bangladesh cancels ship purchase deal from India
Bangladesh has cancelled a $21 million contract with an Indian state-owned shipbuilding company to buy a ship. The cancellation of the deal was reported by several Indian media outlets on Friday (May 23).
According to a report in the Hindustan Times, a $21 million (about Rs 180 crore) deal was signed between Kolkata-based shipbuilding company Garden Reach Shipbuilders and Engineers Limited (GRSE) and the Bangladesh Navy to build an advanced ocean-going tugboat in July last year, a month before the fall of former Prime Minister Sheikh Hasina’s government.
The deal was signed after India and Bangladesh agreed to strengthen long-term defense cooperation during Sheikh Hasina’s visit to India in June last year. In a document filed with the National Stock Exchange of India Limited on Wednesday (May 21), GRSE said, “We would like to inform you that the Government of the People’s Republic of Bangladesh has cancelled this purchase order.”
Several Indian media outlets, including the Times of India, have reported on the matter, citing the stock market document. BBC Bangla also quoted the letter from GRSE in its report on the matter.
The Hindustan Times report said that the contract for the 800-ton ocean-going tugboat with GRSE was the first major deal under India’s $500 million line of credit for defence procurement.
India and Bangladesh have been in “cold” relations since the fall of the Sheikh Hasina government. Last week (May 17), India announced a ban on imports of several Bangladeshi goods, including garments, through land ports. This is expected to result in a loss of $770 million or 770 million worth of Bangladesh’s annual exports, which is about 42 percent of bilateral trade.
Bangladesh has cancelled the tugboat purchase deal, a week after India imposed a ban on imports. The Times of India called it a “major blow to bilateral relations”. The Bangladesh Navy or the Defence Ministry have yet to issue a statement on why the deal was cancelled. A senior Bangladesh government source, speaking on condition of anonymity, told BBC Bangla that they were also aware of the cancellation of the order but could not say why or when the decision was taken. The Indian company also did not provide any information on why Bangladesh cancelled the deal.
