Agreement with Airbus to Be Signed Before PM’s US Visit

Hasan Sohail

Prime Minister Tarique Rahman is scheduled to visit the United States on September 21. US President Donald Trump has already expressed his hope of meeting the prime minister during the visit. During the visit, discussions are expected on Bangladesh’s recent agreement to purchase 14 aircraft from US aircraft manufacturer Boeing. The two sides are also expected to discuss the prospects for US investment in Bangladesh.

Amid these discussions, Bangladesh has decided to purchase 10 aircraft from European aircraft manufacturer Airbus for Biman Bangladesh Airlines. Preparations are underway to sign an agreement with Airbus before the prime minister’s US visit, according to sources at the Ministry of Civil Aviation and Tourism.

The aircraft will be added to the fleet of Biman Bangladesh Airlines in phases from 2031.
Officials from Airbus and Biman said the company recently submitted a new proposal to Biman’s techno-finance committee. The proposal includes four A350-900 wide-body aircraft and six A321neo narrow-body jets.

Biman officials believe that adding new-generation aircraft will reduce fuel consumption and maintenance costs. It will also increase the daily utilisation of each aircraft. This could reduce operating costs in the long term. The decision to purchase 10 aircraft from Airbus comes while the process of purchasing 14 aircraft from US-based Boeing is already underway. As a result, aircraft from the world’s two major commercial aircraft manufacturers, Boeing and Airbus, will operate side by side in Biman’s fleet.

US President’s special envoy Sergio Gore has recently highlighted the sale of Boeing aircraft to Bangladesh in a post on X. He referred to a new agreement. Mr. Gore said, “This week, another extraordinary deal was made between President Mr. Trump and the Prime Minister of Bangladesh. Under this, Bangladesh has committed to spending billions of dollars, which is much more than their initial order.”

US President Donald Trump later sent a letter to Prime Minister Tarique Rahman thanking him for agreeing to purchase Boeing aircraft. Trump said, “Boeing will not let you down, and neither will I forget this. Thank you very much for your attention to this matter. I look forward to seeing you, hopefully in the very near future.”

On the same day, Civil Aviation and Tourism Minister M Rashiduzzaman Millat told journalists that Bangladesh would purchase 14 Boeing aircraft at the request of US President Donald Trump. There are also plans to lease more aircraft. During the previous Awami League government, an in-principle decision had been announced to purchase 10 Airbus aircraft. However, following the fall of the former PM Sheikh Hasina government in the July uprising and amid pressure from Donald Trump over tariffs, the aircraft order ultimately went to Boeing.

Under pressure from the Europeans, however, the current government is now moving to sign an agreement to purchase aircraft from European manufacturer Airbus as well. Analysts believe the decision reflects Bangladesh’s “balanced diplomacy”, with the country seeking a trade agreement with the United States while protecting the interests of its garment sector in Europe.

To reduce the trade deficit with the United States and seek lower tariffs on Bangladeshi products, Biman signed a $3.7 billion agreement with Boeing on April 30, equivalent to around Tk 450 billion. Under the agreement, Biman will purchase 14 aircraft: eight Boeing 787-10 Dreamliners, two Boeing 787-9 Dreamliners and four Boeing 737 MAX aircraft.

Soon after, Airbus revised its proposal, while European diplomats continued to put pressure in favour of Airbus. As part of this process, EU Ambassador Michael Miller last Sunday expressed hope that discussions on purchasing Airbus aircraft would move forward quickly as part of efforts to increase aviation and trade cooperation between Bangladesh and the EU.

He also urged Bangladesh to consider the matter “very seriously”. However, analysts believe it will be difficult to manage the financial pressure created by purchasing aircraft from both companies. Some have also described the decision as timely. Biman currently has 19 aircraft in its fleet, 14 of which are made by Boeing. In addition, the service life of three aircraft will expire next year. Therefore, many believe the purchases are necessary to strengthen Biman’s fleet.

At the same time, if the plan is implemented, Bangladesh could become an important regional hub for passenger and cargo transport in South Asia. Civil Aviation and Tourism Minister M Rashiduzzaman Millat said 10 aircraft would be purchased under the agreement with Airbus, with deliveries scheduled to begin in 2031. The price and other terms will be disclosed after the agreement is finalised.

M Rashiduzzaman Millat said Bangladesh is purchasing 14 Boeing aircraft at the request of US President Donald Trump and also plans to lease more aircraft. Asked whether purchasing so many aircraft from Boeing could put pressure on the economy, Information Adviser Dr Zahed Ur Rahman said, “The government inherited a very bad economy, that is not wrong. This is one. Two is, the payments for these Boeings that we are talking about buying will be made in phases from now and will continue for a long time, and receiving these Boeings will take a long time for us.”

Dr Zahed said there would be no immediate impact from the purchase of Boeing aircraft. He said, “If any of us think that I have to pay a lot of money immediately or within a very short time, that is not the case at all. A state will operate according to its needs. Even if a state is in crisis, it will meet some of its needs. So, the new Boeing order will have no immediate effect.”

Aviation analyst ATM Nazrul Islam said the main challenge would be arranging the necessary pilots, cabin crew, engineers and maintenance equipment when the new aircraft arrive. This will require extensive training. He also said there are major questions about how the pre-delivery payments for the Airbus aircraft will be made.

“Even if all the aircraft do not arrive at the same time, payments to both Boeing and Airbus will begin at the same time. Therefore, the bigger issue than adding aircraft to the fleet is ensuring repayment on time and generating sufficient revenue. There is no opportunity to buy aircraft and keep them idle,” he said.

He said if two or three aircraft were brought in every year, it would be easier to manage. But suddenly finding enough skilled pilots and crew for so many aircraft would be extremely difficult. He warned that even a minor mistake or failure in planning could put Biman Bangladesh Airlines in serious trouble.

Strategy to Balance the Rivalry Between Two Giants

The world’s two largest aircraft manufacturers, Boeing and Airbus, have been competing for years to secure a place in Biman’s fleet. The competition is not only commercial. It is also linked to the diplomatic and economic interests of the United States and the European Union. Airbus’s campaign became more visible during French President Emmanuel Macron’s visit to Bangladesh in 2023. Since then, Airbus representatives have visited Dhaka several times and held discussions with the government.

At the same time, the process of purchasing 14 aircraft from Boeing moved forward amid ongoing trade talks and economic relations with the United States. The Boeing package includes eight Boeing 787-10 Dreamliners, two 787-9 Dreamliners and four 737 MAX 8 aircraft. The estimated value of the package is around $3.7 billion.

With the latest decision, Biman is preparing, for the first time, to operate a fleet containing modern aircraft from both Boeing and Airbus.
At present, Biman’s fleet is mainly dependent on Boeing and Dash 8 aircraft. If the new plan is implemented, the national flag carrier will operate both Boeing and Airbus jets.

Many major airlines around the world operate mixed fleets. This allows them to use different types of aircraft depending on specific routes, passenger numbers and operating costs. It increases flexibility in route planning and reduces the risk of depending on a single type of aircraft.

Airbus’s Revised Proposal

Earlier this year, after Biman Bangladesh Airlines signed a multibillion-dollar agreement with Boeing, European aerospace and aircraft manufacturer Airbus submitted a revised proposal to Biman to sell 10 aircraft instead of its previous proposal. It was against this backdrop that the latest discussions took place.

Officials from Airbus and Biman said the company recently submitted a new proposal to Biman’s techno-finance committee. The proposal includes four A350-900 wide-body aircraft and six A321neo narrow-body jets. Biman signed a $3.7 billion agreement with Boeing on April 30. Under the agreement, Biman will purchase 14 aircraft, including eight Boeing 787-10 Dreamliners, two Boeing 787-9 Dreamliners and four Boeing 737 MAX aircraft.

Airbus revised its proposal soon after.
People familiar with the sector said Airbus reduced the size of its original proposal as a strategy to remain competitive in Bangladesh’s long-term fleet expansion programme. The earlier proposal included 14 aircraft: 10 A350 wide-body jets and four A320neo narrow-body aircraft. The A321neo is an extended version of the A320neo family. It can carry around 180 to 220 passengers.

As part of efforts to modernise the state-owned airline and turn Bangladesh into a regional aviation and cargo hub, the government is reviewing a long-term plan to increase Biman’s fleet to 47 aircraft by the 2034-35 fiscal year.
It is in this context that Airbus submitted its new proposal.

Diplomats from several European countries, including France, the United Kingdom and Germany, have been encouraging Bangladesh to consider purchasing Airbus aircraft through a balanced and competitive procurement process.

Airbus’s discussions gained momentum following high-level diplomatic efforts surrounding French President Emmanuel Macron’s visit to Bangladesh in 2023. A Bangladesh-UK joint statement also mentioned the possibility of purchasing 10 Airbus A350 aircraft, including cargo versions. Biman currently has 19 aircraft, of which 14 are manufactured by Boeing.

Long-Term Plan

The government is reviewing a plan to increase Biman’s fleet to 47 aircraft by the 2034-35 fiscal year. The goal is to transform the national flag carrier into a modern, profitable and regionally competitive airline. At the same time, the government plans to turn Bangladesh into an important regional hub for passenger and cargo transportation in South Asia. If 10 Airbus aircraft and 14 Boeing aircraft are added to the fleet, Biman will undergo its biggest fleet transformation in the next decade. The change will not only increase the size of the fleet but will also reshape the airline’s operating strategy.