THE Dhaka Water Supply and Sewerage Authority, which has continued to incur losses despite increases in water tariff for 15 times since 2009, when the Awami League assumed office to continue for consecutive tenures before its overthrow on August 5, and has struggled to improve the quality of supply water, has now run into a new problem. Two projects that the agency has completed 鈥� a sewage treatment plant at Daserkandi, built for Tk 36.7 billion, and a water treatment plant at Jashaldia in Munshiganj, built for Tk 34.82 billion, on loans taken out from Exim Bank of China on high interest rates and short maturity periods 鈥� have come to be nothing short of the proverbial albatross around DWASA鈥檚 neck. The sewage treatment plant remains idle as the agency fails to feed sewage into the plant from its surroundings, which include Gulshan and Baridhara, in the absence of a linking network. The water treatment plant cannot run to a fourth of its capacity to treat 450 million litres a day in the absence of a matching distribution network at the intake point in Old Town of Dhaka. Both the projects have become a liability for the agency, which is the reflection of poor planning of the agency and the failure of the Planning Commission.
The five-year grace period for loan repayment for the sewage treatment plant would expire soon whilst the five-year grace period for loan repayment for the water treatment plant has already expired. The loan repayment liability for the Daserkandi project has, as agency officials say, reached Tk 32.23 billion and for the Jashaldia project Tk 30.23 billion as of June 2023. The two projects account for about 40 per cent of the Tk 149.82 billion in foreign loan liability of the agency as of June 2023 whilst 21 projects of the agency running on foreign loans, already implemented or being implemented mostly with World Bank and Asian Development Bank assistance, account for 60 per cent of the agency鈥檚 payment liability. The Institute for Inclusive Finance and Development executive director says that the terms and conditions of the Chinese loans were more stringent than those of World Bank and Asian Development Bank funds. The agency鈥檚 officials say that the Chinese construction company came in after the World Bank and the Asian Development Bank had declined to lend money for the 鈥榰nviable鈥� projects in the second consecutive tenure of the Awami League in office. Experts believe that while the agency should take initiatives to make the treatment plants fully functional, the officials involved in corruption, flawed planning and project implementation should be held to account. Experts further believe that the government should aim at debt restructuring to check against risks of repayment default on the projects.
The government should, therefore, heed what experts have suggested at least to get over the situation that corruption, mismanagement and the waste of funds have plunged the agency in. An increased loan repayment liability and a growing operating cost forced the agency to incur Tk 5.84 billion in losses in the 2023 financial year.
