Sylhet Bureau :
The government on Tuesday approved a Chinese-funded project to convert the Akhaura-Sylhet metre gauge rail line into a dual gauge one with a condition of reviewing its cost of Tk 16,104.44 cr.
The decision was taken at a meeting of the Executive Committee of the National Economic Council where questions were raised about the project cost, said the officials attending the meeting.
The ECNEC meeting with Prime Minister Sheikh Hasina in the chair at NEC conference room discussed whether the project to be implemented with Tk 10,645.36 cr credits from China was inflated, said the officials.
On 15 September 2015, a memorandum of understanding was signed between Bangladesh Railway and China Railway Bridge Engineering Bureau Group for the rail line construction.
Planning minister MA Mannan admitted that project cost would be reviewed in line with an ECNEC directive.
He, however, told that ECNEC passed the project in principle.
Responding to a question on whether the project cost was inflated at a post-ECNEC briefing, Mannan earlier said they did not determine the costs.
Engineers and public officials were mainly responsible for calculating the projects’ costs, he said.
While reviewing the proposal placed by the railways ministry, the prime minister inquired about methodologies for determining the project cost. Officials of both the railway ministry and the economic relation division informed the ECNEC that ‘discount rate’ of 15 per cent was considered to calculate the project cost.
Discount rate is a vital component of development projects to analyse their costs and benefits in future which varies from country to country.
The ERD officials, who mainly negotiate with China for the projects costs, informed the ECNEC that Bangladesh Bank recommended determining the discount rate at 12 per cent while the International Monetary Fund suggested discount rate at 5 per cent.
The ECNEC then asked the railways ministry to follow the central bank’s guideline while reviewing the project cost.
The government would contribute Tk 5,450 crore to the project taken for unification of rail line in Dhaka-Chittagong-Sylhet rail corridor, a part of the Trans Asian railway network.
The project is expected to be completed in June 2025 will ensure easy, regular, comfortable and safe journey.
Under the projects, a total of 239.14km single dual-gauge track, including 176.24km main line and 62.90km loop line, will be constructed in addition to improving signaling system at 22 stations. Around 200 acres of land will be acquired for the project.
Among other proposal approved by ECNEC on the day include establishment of special economic zone for Indian investors at Mirsarai and construction of an embankment in Kurigram to check erosion from the River Brahmaputra. The establishment cost of the Indian SEZ at Mirsarai has been calculated at Tk 919 crore with Tk 914.59 crore as credit from India.
The government would contribute Tk 5.26 crore to the project expected to be completed in June, 2021.
The embankment in Kurigram will be built at a cost of Tk 479.30 crore by June 2021.
The government on Tuesday approved a Chinese-funded project to convert the Akhaura-Sylhet metre gauge rail line into a dual gauge one with a condition of reviewing its cost of Tk 16,104.44 cr.
The decision was taken at a meeting of the Executive Committee of the National Economic Council where questions were raised about the project cost, said the officials attending the meeting.
The ECNEC meeting with Prime Minister Sheikh Hasina in the chair at NEC conference room discussed whether the project to be implemented with Tk 10,645.36 cr credits from China was inflated, said the officials.
On 15 September 2015, a memorandum of understanding was signed between Bangladesh Railway and China Railway Bridge Engineering Bureau Group for the rail line construction.
Planning minister MA Mannan admitted that project cost would be reviewed in line with an ECNEC directive.
He, however, told that ECNEC passed the project in principle.
Responding to a question on whether the project cost was inflated at a post-ECNEC briefing, Mannan earlier said they did not determine the costs.
Engineers and public officials were mainly responsible for calculating the projects’ costs, he said.
While reviewing the proposal placed by the railways ministry, the prime minister inquired about methodologies for determining the project cost. Officials of both the railway ministry and the economic relation division informed the ECNEC that ‘discount rate’ of 15 per cent was considered to calculate the project cost.
Discount rate is a vital component of development projects to analyse their costs and benefits in future which varies from country to country.
The ERD officials, who mainly negotiate with China for the projects costs, informed the ECNEC that Bangladesh Bank recommended determining the discount rate at 12 per cent while the International Monetary Fund suggested discount rate at 5 per cent.
The ECNEC then asked the railways ministry to follow the central bank’s guideline while reviewing the project cost.
The government would contribute Tk 5,450 crore to the project taken for unification of rail line in Dhaka-Chittagong-Sylhet rail corridor, a part of the Trans Asian railway network.
The project is expected to be completed in June 2025 will ensure easy, regular, comfortable and safe journey.
Under the projects, a total of 239.14km single dual-gauge track, including 176.24km main line and 62.90km loop line, will be constructed in addition to improving signaling system at 22 stations. Around 200 acres of land will be acquired for the project.
Among other proposal approved by ECNEC on the day include establishment of special economic zone for Indian investors at Mirsarai and construction of an embankment in Kurigram to check erosion from the River Brahmaputra. The establishment cost of the Indian SEZ at Mirsarai has been calculated at Tk 919 crore with Tk 914.59 crore as credit from India.
The government would contribute Tk 5.26 crore to the project expected to be completed in June, 2021.
The embankment in Kurigram will be built at a cost of Tk 479.30 crore by June 2021.
