A nine-year-old World Bank-backed project to improve the Chattogram–Dhaka–Ashuganj inland waterway corridor is set to get a third revision, with the authorities seeking to restructure its financing and scope, cut the estimated cost by Tk631.23 crore and extend the implementation deadline to June 2028.
The proposed revision of the Bangladesh Regional Waterway Transport Project-1 (BRWTP-1) comes after repeated implementation delays, changes in financing arrangements, adjustments to contract packages and the need to accommodate remaining works.
The project, being implemented by the Bangladesh Inland Water Transport Authority (BIWTA), was originally approved in 2016 and its second revised cost currently stands at about Tk2,800.42 crore.
The proposed third revision would bring the cost down to roughly Tk2,169.19 crore, according to Planning Commission that has recently held a Project Evaluation Committee (PEC) meeting on the proposal.
“The PEC has already examined the third revision proposal at a recent meeting and asked the implementing agency to incorporate its observations, including a clear work plan in line with the proposed deadline, before submitting the revised development project proposal (RDPP) again,” said Md Neyamat UllahBhuiyan, member of the Planning Commission’s Physical Infrastructure Division.
The committee’s discussion focused particularly on the change in the source of project-loan financing, the status of unfinished works, changes in contract packages and their costs, he added.
He further said appointment of a new supervision consultant, foreign-currency adjustment and whether the remaining work can realistically be completed within the proposed extended timeframe were also discussed.
The World Bank originally approved $360 million for BRWTP-1 in June 2016 to improve the efficiency and safety of inland water transport along the Chattogram–Dhaka–Ashuganj corridor.
The financing included navigation improvement, development and upgrading of terminals and landing facilities, and other infrastructure intended to facilitate passenger and cargo movement.
The project was initially scheduled for completion by June 2024, but its closing date was subsequently extended to December 2025 at the World Bank level; Bangladesh’s current project documents show the second revised implementation period running through June 2027.
Cost to fall by Tk631cr
According to the PEC meeting documents, the project’s current revised cost is around Tk2,800.42 crore. Under the proposed third revision, this would come down to approximately Tk2,169.19 crore, representing a reduction of Tk631.23 crore.
At the same time, the authorities are seeking to extend the project’s implementation period up to June 2028.
The reduction in cost has resulted from changes in the scope and value of several work packages, lower costs in some contracts and adjustments made during implementation.
The revision is also intended to reflect the actual financial position of the project and the works that remain to be completed.
The PEC discussed whether the reduction in expenditure could have any implications for the quality and intended outcomes of the project. The project authorities explained the reasons behind the lower package costs and other adjustments.
Financing source changed
A major change proposed under the third revision is the source of financing for the project’s remaining loan-funded works. The PEC discussed the issue with a representative of the Economic Relations Division (ERD), according to the meeting minutes.
The project documents show that the remaining financing requirement includes US$61.29 million under the Accelerating Transport and Trade Connectivity in Eastern South Asia-Bangladesh Phase 1 (ACCESS) project, which is also financed by the World Bank.
Under the proposed arrangement, this financing will be brought into the financing structure of the waterway project for its remaining works. As a result, the existing Financing Agreement needs to be amended, and the changed financing source must be reflected in the revised DPP.
The PEC therefore directed the project authorities to incorporate the financing-source change and the necessary amendment to the Financing Agreement into the third revised DPP.
The change is being proposed alongside adjustments to project components, contract packages and the implementation period, so that the project’s development document corresponds with the financing arrangement now being used for the remaining works.
A project repeatedly revised
BRWTP-1 has already undergone two revisions since its approval.
The project was conceived as a major intervention to improve navigation and transport services along the Chattogram-Dhaka-Ashuganj corridor, one of the country’s important inland waterway routes. Its components include navigation improvement, dredging and related works, terminal development, landing facilities and institutional support.
But implementation has taken substantially longer than originally planned.
Over the years, changes in procurement arrangements, contract packages, consultancy services and other implementation requirements have altered the project’s original structure. The Covid-19 pandemic and delays associated with procurement and consultancy arrangements also affected implementation.
The latest revision seeks to accommodate the remaining physical work, changes in the scope and value of contracts, a new supervision consultancy and other costs that have emerged during implementation.
PEC demands completion plan
The committee’s strongest emphasis, however, was on the proposed June 2028 completion deadline.
Rather than merely extending the project period, the PEC directed the authorities to include a clear work plan in the RDPP showing how the project will actually be completed by June 2028.
The committee also asked the implementing agency to incorporate the agreed changes relating to contract packages, supervision consultancy, financing, foreign-currency adjustment and project implementation period in the revised document.
The instruction comes after the project has already received repeated extensions and revisions, making the credibility of the new completion schedule a central issue in the latest proposal.