Four ‘fast-track’ projects of transport sector not ‘on-track’

The four ‘fast-track’ projects of the country’s transport sector have fallen behind their respective completion target due to tardiness in their implementation process, officials said on Wednesday. They said among the total 10 ‘fast-track’ projects, the government has given utmost priority to four transport sector projects. These are — Tk 287.93-billion Padma Bridge construction, Tk 349.88-billion Padma railway link, Tk 219.85-billion Dhaka Mass Rapid Transport (MRT Line-6), and Tk 180.34-billion Dohazari-Ramu-Cox’s Bazar-Ghundum project.

Among these four prioritised projects, not a single one will be completed before the next national election, although the government promised to inaugurate those during its current tenure. The government’s high-ups maintaining silence over the sluggish progress of the nearly US$ 40-billion cost 10 ‘fast-track’ projects.  Even, the Prime Minister-led committee on supervising the ‘fast-track’ projects has not sat in last two years, after in April 2016, said the officials concerned. Earlier, the government formed the PM-led committee to look after and streamline implementation of the ‘fast-track’ projects to complete those before the next election, expected to be held in December next.
According to them, almost all the ‘fast-track’ transport sector projects are far behind their execution schedule.
The Bangladesh Bridge Authority (BBA) implemented 53 per cent of the project until this March, and spent Tk 150.77 billion out of its total outlay of Tk 287.93 billion. The BBA has divided the project work into five packages — main bridge, river training, Janjira approach road, Mawa approach road, and service area-2 construction work.
According to the schedule, the implementing agency will complete construction work of the 6.15-km main bridge by this November.  But the BBA in its own report said it has completed 59 per cent of the physical work, and spent 55.81 per cent of its total outlay. It means, the remaining 41 per cent of the bridge construction work will have to be completed within the next seven months.
Project insiders said the BBA has been facing troubles in pilling work in some 21 piers of the bridge, as solid base is not being found on the river bed. It is hampering the pilling work for building the piers.
Similarly, river training work, another crucial component of the project, is also going slowly, as only 36 per cent of the physical progress has been done until March last.  So, the contractor has to complete the remaining 54 per cent work within the schedule of December 2018. However, the progress of Mawa and Janjira approach roads and service area-2 packages are satisfactory, as those have been completed before June 2017. The government, in early 2016, approved Padma railway link project at a cost of Tk 349.88 billion to complete it by June 2022. But the railway line construction work is yet to start. On April 27 last, Bangladesh signed a US$ 2.67-billion loan deal with China for constructing the railway line on Dhaka-Padma Bridge-Bhanga-Jessore route. The Bangladesh Railway (BR) officials said they have started earthwork for the railway line, and some 11 per cent of the physical work of the project has been completed. The state-owned railway service provider has spent Tk 22 billion, 6.0 per cent of the Tk 349.88-billion cost project, until March. The BR has got an allocation of Tk 68.11 billion in the current Revised Annual Development Programme (RADP). The government earlier announced that it would try to open even a part of the line, between Dhaka and Bhanga, simultaneously with the Padma Bridge inauguration.  After a long stalemate, the construction work of the 10-km line between Uttara and Agaragon under MRT Line-6 project (Dhaka Mass Rapid Transit Development Project) is now on.
The government, in July 2012, approved the project at Tk 219.85 billion cost. Of the amount, Japan International Cooperation Agency (JICA) is providing Tk 165.94 billion, while the government will provide the rest.
The 20-km MRT line between Uttara and Motijheel is scheduled to be completed by June 2024.
Project insiders said as MRT Line-6 project work has started late, its implementation could be delayed to some extent.
Dhaka Mass Transport Company Limited (DMTCL) has divided the entire project into eight packages.
According to DMTCL, it has almost completed Package-1 (CP-01) work, and land development for the railway depot at Uttara 3rd phase.  Now the construction work of Package CP-02 (depot civil and buildings), CP-03 and CP-04 (viaduct and stations between Uttara and Agargaon) has been going on. For the last one year, Italian-Thai Development Public Company Limited has been working to build the 10-km MRT line between Uttara and Agargaon. The company has already acquired partial roads from Agargaon to Mirpur Cantonment to set up piers for the elevated line. However, insiders said the company is advancing slowly with its work due to lack of adequate equipments and manpower as well as the chosen sites of entire 10-km MRT line. Meanwhile, the DMTCL signed separate deals with two Japanese and Thailand-based joint-venture companies on April 30 for implementing packages CP-05 and CP-06 (viaduct and stations between Agargaon and Motijheel).  As per the contracts, the two companies will build the line from Agargaon to Karwan Bazar and from Karwan Bazar to Motijheel in 36 months from the work order date. The DMTCL under the remaining Package CP-07 will complete electro-mechanical systems work, and under CP-08 will procure rolling stock and depot equipments for operating MRT Line-6.
The government in 2010 approved the 102-km railway line project at a cost of Tk 180.34 billion, which is scheduled to be completed in June 2022.
But the project has seen the light of execution in the last one year, as Asian Development Bank (ADB) and China approved their pledged fund for railway line construction. On September 28, 2017, ADB approved around Tk 120.00 billion ($ 1.5 billion) for the project. This is the largest-ever investment made in the railways sector by ADB.
According to BR officials, they have been working to acquire and develop land for the line from Dohazari to Cox’s Bazar in the first phase of the project. The project has been divided into two packages. Under the first package, rail-line will be constructed from Dohazari to Chakaria. China’s CREC and Bangladesh’s Toma Construction Company will jointly construct it at Tk 26.88 billion cost. Under the second package, the contractor – CCICC and Bangladesh’s Max Infrastructure Ltd – will construct the dual-gauge single line from Chakaria to Ramu and Cox’s Bazar at a cost of Tk 35.03 billion.

Bangladesh tops China, India

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Benapole land port needs more warehouses

Businesses that trade with India yesterday demanded more warehouses at the Benapole land port by private sector players like in the Chittagong port for proper storage of imported and export consignments. “It’s absolutely a necessity,” said Motiar Rahman, a clearing and forwarding agent, adding that 19 private warehouses were built around the Chittagong port in the last ten years for safer storage of imported and export goods. The existing 60,000 square feet government-owned warehouse is simply not adequate for the expanded trading relationship between the two neighbouring countries, businesses said at a seminar styled “addressing land port issues for better Indo-Bangla trade”.

The seminar was organised by the India-Bangladesh Chamber of Commerce and Industry (IBCCI) and the High Commission of India in Bangladesh at the capital’s Pan Pacific Sonargaon hotel. Due to congestion on either side of the border, importers and exporters have to wait for as many as 25 days and in that time goods deteriorate in quality or go missing in the absence of adequate storage facilities. For instance, in the past 15 days, more than 4,000 trucks have been unable to enter Bangladesh from Indian Bangaon-Chakdaha side due to lack of space in Benapole, said Rahman, who is also the chairman of the import-export sub-committee of the IBCCI.

Abdul Matlub Ahmad, the IBCCI president, echoed the same. “It is very difficult for businessmen to wait for up to 25 days for unloading goods.” “Unless we have enough warehouses, we cannot do business. The private sector is ready to help to build the warehouses at the port and we are ready to help the government.” Ahmad, who is also the immediate past president of the Federation of Bangladesh Chambers of Commerce and Industry, recommended making all 22 land ports along the India-Bangladesh bordering areas fully operational to further bilateral trade.

Currently, Bangladesh has 23 land ports, 22 of which are located along the Indian border. Only the Teknaf land port is with Myanmar. Last fiscal year, Bangladesh imported goods worth $6.5 billion from India — 90 percent of which were brought in through the land ports. Goods worth $650 million were shipped to India in 2016-17, according to data from the Export Promotion Bureau. If better land port facilities can be created, Bangladesh can easily grab a good portion of the $30 billion Indian apparel market, Ahmad said.

He also called for an office of the Bangladesh Standards and Testing Institution at the Benapole land port for quick release of certification. In 2016-17, the Petrapole-Benapole land port alone accounted for 37 percent of the total trade between the two countries, said Adarsh Swaika, deputy high commissioner of India in Bangladesh.

Recognising the importance of the land port, the Indian government will convert Petrapole and Agartala into integrated check posts to facilitate the movement of cargo. The idea behind the construction of integrated check posts is to bring different agencies and services such as customs, immigration and border security under one integrated complex and facilitate seamless movement of goods and people. Swaika, currently the acting Indian High Commissioner, said seven more land customs stations on the India-Bangladesh border will be upgraded to integrated check posts.

For instance, work on upgrading the Dawki land customs station on the Meghalaya-Bangladesh border is already underway, he added. In 2016-17, a total of 155.19 lakh tonnes of goods were imported and exported through the land ports, according to Shipping Minister Shajahan Khan. In 2008-09, it was 34.26 lakh tonnes.

Bangladesh earned Tk 111.47 crore from the land port last fiscal year in contrast to Tk 26.74 crore in 2008-09, he added. “Twelve more land ports are on way now,” said Tapan Kumar Chakravorty, chairman of the Bangladesh Land Port Authority, which manages six of the land ports. The trade imbalance with India is a reality for Bangladesh as the country imports a lot of basic goods from its largest neighbouring country, said Tariq Karim, a former Bangladesh ambassador to India. He suggested speeding up the e-commerce facility at the land port to boost bilateral trade.

Non-tariff, procedural and regulatory barriers are standing in the way of higher bilateral trade between the two countries, said Bipul Chatterjee, executive director of CUTS International, an Indian research body.

Garment makers seek full waiver of source tax

Garment makers, the country’s main export earners, yesterday sought full waiver of source tax on export receipts for three years as a helping hand as they look to hit $50 billion in shipments by 2021. At present, the tax authority collects 0.70 percent tax on total export proceeds from major export items, including garment.

The amount of source tax collection from apparel shipment would not be more than Tk 2,000-2,500 crore on export receipts of $30 billion, said Siddiqur Rahman, president of the Bangladesh Garment Manufacturers and Exporters Association. “This is not a big amount,” he said in a meeting with high officials of the National Board of Revenue ahead of formulation of tax measures for fiscal 2018-19. The government plans to frame a budget of more than Tk 400,000 crore for the next fiscal year. There would be no big impact if the source tax is not collected from garment exporters considering the sector’s contribution to direct and indirect job creation, he added.

“So, please waive the tax,” he added. The plea from garment exporters comes at a time when apparel shipments are on the rise. Garment shipments rose 9 percent year-on-year to $22.83 billion in the first nine months of the fiscal year, according to data from the Export Promotion Bureau. The tax collector does not maintain sector-wise corporate tax collection data. Yet, three taxmen said source tax collected from export proceeds of garments is roughly the amount of income tax the government gets from the apparel sector. The apparel makers enjoy a reduced corporate tax rate of 12 percent.

“And many firms submit income tax returns in a way that their total tax does not exceed the source tax collected from export proceeds,” said a senior official of the NBR seeking to remain unnamed. The BGMEA president also demanded a reduction of corporate tax to 10 percent for all exporters. At the meeting, cloth merchants and some apparel makers got into an argument on the misuse of the bonded warehouse privilege.

The cloth merchants said a section of garment exporters, including non-existent firms, are importing fabrics duty-free and are selling them in the domestic market. “This hurts importers and producers who make cloth for the domestic market,” said Md Shamsul Alam of the Bangladesh Cloth Merchant Association. But the BGMEA president said the leaked items are bought by cloth merchants.

The domestic weaving industry is suffering for the leakage of goods from bonded warehouses and the smuggling through borders, said the Bangladesh Specialised Textiles Mills and Powerloom Industries Association. In response, Rahman said the BGMEA would examine the status of bonded warehouse licence-holding firms in the apparel sector and requested the revenue board to cancel the licences of non-existent firms to prevent misuse. The Bangladesh Knitwear Manufacturers and Exporters Association demanded fixation of tax at 0.50 percent only on cutting and making instead of the source tax on export proceeds. The Leathergoods and Footwear Manufacturers & Exporters Association of Bangladesh called for a reduction of tax on technical assistance and royalty fees. It also demanded duty-free benefit for importing fire and electrical items to ensure fire safety at factories.

NBR Chairman Md Mosharraf Hossain Bhuiyan said the board would try to provide the same benefit to all exporters to encourage shipment in both volume and value.