On July 16, China Gezhouba Group Company submitted a letter of interest to the Bangladesh government for the construction of the $3 billion Bhola Bridge project. At 9.2‑km in length, the bridge will be Bangladesh’s longest. Local authorities have reportedly applied to the Export-Import Bank of China for $1.226 billion in lending to help finance the project.
Bangladesh’s ratio of debt from China to GDP is 4.4%. Taking on this level of financing would increase the ratio to approximately 5.1%. While, according to the IMF, multilateral creditors account for a large share of the total public debt (led by lending from the World Bank and the Asian Development Bank), China and Japan are the largest bilateral creditors.
Chinese companies have previously built a series of smaller-scale “friendship bridges” in Bangladesh, as well as the Padma Bridge Rail Link Project. Bangladesh has a mixed track record of depending on China for financing infrastructure projects. Although Bangladesh has taken Chinese debt in a number of cases, it’s noteworthy that the Padma Bridge, under construction by China Major Bridge Engineering Company Limited since 2014, was financed entirely by the government of Bangladesh.