Two railway projects are likely to see budget cuts of around Tk 7,300 crore in a slimming-down attempt as officials view that earlier these projects were not ‘examined properly’.Â
One of these projects is for building a track between Bangladesh and neighbouring Myanmar, while the other is for constructing a track on the Dhaka-Jashore route through the Padma Bridge.
The reduction in the cost came following the shedding of the plan to build a track between the two countries, leading to a reduction in public works, land acquisition, consultancy service requirements, and other activities.Â
Railways ministry secretary Abdul Baki told ¶¶Òõ¾«Æ· on Monday that following an instruction of the new interim government they were assessing the cost reduction aspects of the railway’s 29 ongoing projects.
Proposals have been made to cut Tk 6,682.86 crore from the ‘Construction of single line dual gauge track on Dohazari-Ramu-Cox’s Bazar and Ramu-Gundum (Myanmar)’ project, and another Tk 621 crore from the Padma Bridge Rail Link Project.
‘I believe that these two projects were not properly examined and then were expanded,’ Abdul Baki said, adding that they would take action if any evidence of corruption is found.
A project evaluation committee meeting is scheduled to be held today at the Planning Commission on the proposed second revision of the Dohazari-Ramu-Cox’s Bazar-Gundum project.
Under the project, in phase one, a 102-kilometre railway line has already been built and inaugurated in November 2023 on the Dohazari–Ramu-Cox’s Bazar section.
In phase two, the project was scheduled to construct a 28.752km track on the Ramu–Gundum (Myanmar) section.
The development project proposal was approved by the Executive Committee of the National Economic Council for the first time on July 6, 2010 at an estimated cost of Tk 1,852.35 crore.
In April 2016, the national economic council approved the first revised project with an estimated cost of Tk 18,034.47 crore. The cost sharing stood at—loan assistance by the Asian Development Bank of Tk 13,115.4 crore and government funding of Tk 4,919.06 crore.
A breakdown of the proposed second revision of the project presents the item-wise cost reduction—Tk 2,558.11 crore by discarding the plan to build the track on Ramu–Gundum section; Tk 1,902.21 crore in public works; Tk 978.25 crore in contingency; Tk 484.08 crore in CD-VAT; Tk 46.87 crore in consultancy fees; Tk 7.1 crore in rehabilitation and land acquisition part on Dohazari-Cox’s Bazar section; and Tk 3.32 crore in project management part.
In the second revision, the project cost would be 37.06 per cent less than the cost determined at its first revision, said a project document.
Under the second revision, now the project cost is estimated at Tk 11,351.62 crore—loan assistance Tk 8,639.57 crore and government funding Tk 2,712.05 crore.
As per the development project proposal, the project was scheduled to be concluded by December 2013, which was extended till June 2016 for the first, June 2022 for the second and June 2024 for third time.
The second revision of the project proposes June 2025 as the latest deadline.
The project began in July 2010, aimed at connecting with the trans-Asian railway corridor, and bringing Cox’s Bazar under the rail network.
Till August this year the physical progress of the project was 98.32 per cent and financial progress was 50.18 per cent.
Under the fast-track Padma Bridge Rail Link project, the railway is setting up a 169-kilometre track between Dhaka and Jashore via Padma Bridge at a cost of Tk 39,246.79 crore.
The Export-Import Bank of China is funding Tk 21,036.69 crore of the cost with the Bangladesh government spending the rest of Tk 18,210.11 crore.
In November 2023, train operation started on the line.
The project started in January 2016 and scheduled to be completed by June 2025.
Till August this year, the physical and financial progress of the project was 96 per cent and 85.98 per cent respectively.
Railway planning department officials said that the proposal for reducing the project cost by Tk 621 crore from some components was already sent to the Planning Commission for approval.
Railways ministry secretary Abdul Baki told ¶¶Òõ¾«Æ· on Monday that they were hoping to reduce costs of other ongoing projects, too.
He mentioned that many big railway projects were taken without any feasibility studies, or without doing them properly. In some cases where project costs soared several folds, no studies were done to find out the reasons for such increases, he added.Â
Replying to a question whether action would be taken against officials responsible for cost over estimation, Abdul Baki said, ‘Right now I cannot say anything in this regard as we are still reviewing these two projects.’