Bangladesh

China withdraws from financing Bangladesh after 'manipulation' gets exposed China Manipulation
Pinu Rahman/Wikipedia Padma Bridge

China withdraws from financing Bangladesh after 'manipulation' gets exposed

Bangladesh Live News | @banglalivenews | 21 Jun 2021, 10:21 pm

Dhaka, June 21: China is backing away from financing at least three projects in Bangladesh after it was caught in a "terrible manipulation" of embezzling thousands of crores of takas by setting additional costs. They have already officially withdrawn funding for a project. The project is to build a mixed gauge double line from Joydebpur in Gazipur to Ishwardi in Pabna near the capital Dhaka.

On the other hand, the Chinese contractor has stated that it will not work on the project of converting the meter gauge line from Akhaura to Sylhet in mixed gauge. Besides, the future of the project of construction of mixed gauge double line from Joydebpur to Jamalpur via Mymensingh is also uncertain.

According to railway sources, the financing of these three projects, the conditions for hiring contractors, the process of determining the cost is the same. As a result, if China withdraws from one project, the other two will suffer the same fate.

These three projects were approved in the GTG method with China. China itself employs Chinese contractors for government loan projects. According to the agreement, there is no opportunity to hire contractors for the projects through international tenders. The companies hired by China get the job and they set the cost at their discretion, which is at least 25 percent more than the actual cost. Moreover, they increase the amount of expenditure by repeatedly extending the duration of the project on various pretexts.

The government came to know about it after the matter was published in the local media last year. Then began the cost assessment at the local expert level. This is how China's manipulations were caught.

According to Railway Ministry sources, Bangladesh is to bear the local cost of land acquisition and rehabilitation and salaries and allowances in the GTG project, and China will pay for the construction; Which is about 80-85 percent of the project cost. The main condition for China's financing is that open tenders cannot be called. Chinese contractor will work. They are ruthlessly exploiting this opportunity.

Meanwhile, an investigation by the Prime Minister's Office revealed that the project was costly. Prime Minister Sheikh Hasina has directed to reduce expenditure by Tk 4,850 crore on two projects worth Tk 30,325 crore. The Ministry of Railways formed the Expenditure Rationalization Committee and made a proposal to reduce the expenditure. China then announced that it was withdrawing from financing a project. During Chinese President Xi Jinping's visit to Bangladesh in 2016, it was agreed that China would finance these projects.

Meanwhile, the construction of railway lines at both ends of the Padma Bridge and the construction of tanks at the bottom of the Karnafuli River in Chittagong are underway under the GTG system with China. The construction cost of the railway at both ends of the Padma Bridge is about Tk 39,247 crore. There are also allegations of huge cost overruns in this project. It is learned that the cost of the project has more than doubled from the original estimate due to repeated extensions. In particular, they have used the coronavirus pandemic as an excuse to increase costs and tenure. The project is expected to be completed in 2024 as per the latest announcement.

Project Director Shafiqul Islam said, "The cost would have been a bit lower if the work had been done through international tenders."

However, he was reluctant to say how much would have been less.