The cost of country’s largest infrastructure project could hit $US2.4 billion dollars

The cost of country’s largest infrastructure project, a 6.15 kilometre multipurpose bridge over the river Padma, could hit $US2.4 billion dollars, officials said Saturday.

Auckland-based Maunsell Aecom, which is designing the project, has said the increased cost was due to last minute addition of electric train tracks, improved safety requirements, railway approach bridge and tourism facilities.

The consultant firm has submitted its ‘scheme design’ of the proposed project to the Bangladesh Bridge Authority late last month, which contains hints on the likely cost of construction.

“Based on Maunsell’s estimate, the cost of the Padma multipurpose bridge could now reach $2.4 billion,” said a senior official familiar with the project.

“The consultants have given extra emphasis on safety and functional requirements, as the life-span of the bridge has been projected to be over 100 years,” the official said.

He said unlike the bridge over the Jamuna, the Padma bridge would be made of steel truss composite, which requires extra safety arrangements, requiring tens of millions of additional dollars.

The bridge will also have facilities for electric train tracks, the first time in the country, and extra-load bearing capacity keeping in mind that the country’s foreign trade would increase several fold in the future.

“In addition, the last minute introduction of railway approach bridge and tourism facilities such as watch towers and audio-visual centers added more cost,” he said.

The government has earlier estimated that the Padma bridge at the Mawa-Janjira point would cost about $1.8 billion. The figure was based on the preliminary feasibility study of the project.

Maunsell officials held a tripartite meeting with a panel of consultants and project officials on Saturday when they discussed the scheme design and the possible cost of the project.

The consultants and the project officials have earlier agreed to build the bridge with steel truss to ensure longevity and reduce the time of construction.

The Awami League government wants to finish the construction — one of its priority projects — by 2013, a year before its five-year tenure expires.

Officials said the contractors can build a steel bridge over the Padma in three and a half years, whereas a concrete structure may take at least six years.

Experts and officials said steel bridge lasts longer than a concrete bridge.

“Across the globe, steel truss composite is the best option for construction of road-cum-railway bridge. The Hardinge Bridge at Bheramara has been built with steel more than 100 years ago,” another official said.

He said building of rail-cum-road bridge with concrete sometimes pose serious safety concerns for the main structure, as vibration between the two tracks could result in cracks.

“We think the cracks at the Jamuna bridge were developed due to this reason,” the official said, preferring anonymity.

In the first design, the length of the Padma Multipurpose Bridge has been estimated at 6.15 km and width 21.10 metre.

It will be the longest bridge in the country, surpassing the 4.80 km long Jamuna Multipurpose bridge constructed in 1997.

It will have four-lane road on the top and a broad-gauge rail lane below, with 150 spans, four-kilometre approach road at Mawa and 12 km in the other side in Madaripur.

The World Bank has assured to lend $460 million for the project. The Asian Development Bank said it would provide $ 350 million, Japan International Cooperation Agency of $200 million and Islamic Development Bank of $ 300 million.

Source: Financial Express

Read Full Post »

PADMA BRIDGE FUNDING-Moves taken to raise Tk 60b from bonds, surcharge

The finance ministry has sought opinions from the Securities and Exchange Commission and the internal resources division to raise about Tk 6,000 crore from local sources to fund the construction of the proposed Padma Multipurpose Bridge. Of the amount, it has planned to raise some Tk 4,000 crore from the local market through bonds which will be issued through SEC, ministry officials said. The rest of the amount is expected to be raised through imposing levy on some 48.12 million phone users, including 46.12 million cell phone subscribers, they said. IRD secretary Nasiruddin Ahmed told New Age that they were examining the proposal for levying the phone users. The IRD was trying its best to send its opinion to the newly established Bridge Division under the communication ministry as early as possible, he added. The communications ministry that will implement the most expensive infrastructure project worth $2.0 billion had proposed the finance ministry to identify the local funding sources before it floats an international tender next December. Communications minister Abul Hossian said his ministry made the suggestions on the local funding sources in a way that would enable a wide range of people to contribute in funding the bridge with a length 6.01 km—which will be the country’s longest. The government is committed to provide one-third of the project cost or more than $600 million by mobilising funds from the local sources. Lenders like Asian Development Bank, World Bank and Japan Bank of International Cooperation have already pledged to lend more than $1.2 billion. Other multilateral and bilateral lenders including Islamic Development Bank committed to provide $120 million in loans. The government is also planning to securitise Jamuna Multipurpose Bridge to raise funds which could also be used for financing the Padma bridge project, said Abul Hossain. The present government took up the Padma bridge as one of its priority infrastructure projects and planned to complete its construction within its five-year tenure. The site has already been selected and initial design of the bridge is nearing completion. The bridge, which will connect Mawa with Janjira on the two banks of the Padma, is expected to contribute to the national economy through boosting the gross domestic product by 1.2 per cent annually.

Source: New Age

Read Full Post »

Negotiations for $745m ADB loan finalized – ADB would give another $245 million fund as budgetary support credit to minimise country’s fiscal deficit

The government has finalised negotiations for a loan of US$745 million from the Asian Development Bank (ADB) Friday to be utilised for weathering the impact of the global economic downturn cast on Bangladesh’s economy, officials said Saturday.In a two-day sitting, the Manila-based lender ADB and the government’s external fund mobiliser ERD completed the loan consultations Thursday in Dhaka.”We’ve finalised the negotiations successfully last week. We are hopeful to receive at least $645 million out of $745 million credit by December this year,’ a senior ERD (economic relations division) official told the FE.He said: “The loan proposal is expected to be placed before the ADB board on 28th September. Once the ADB board approves the proposal, the loan agreement will be signed within two weeks.”Acknowledging the successful negotiations, a senior ADB official in Dhaka told the FE that they expect to start disbursing the loan by October-November this year.The 67-member lender would provide $500 million loan to Bangladesh from its “counter cyclical support facility fund” to shore up the country’s economy that saw the gross domestic product growth (GDP) go down to 5.88 per cent from the initial target of 6.21 per cent last fiscal.Besides, ADB would give another $245 million fund as budgetary support credit to minimise country’s fiscal deficit, that has been projected at 5 per cent of the total GDP in the financial year 2010.The ERD official said though the loan is more costly compared to other ongoing assistances, the government has to accept it to resist the adverse impact of the second round of effects.The $500 million credit has to be repaid within five years with a three-year grace period. It carries a commitment charge of 75 basis points and an annual interest rate of LIBOR plus two percentage points, the ERD official said.He said the Manila-based lending agency would charge higher rate for the assured $245 million budget support credit incorporating some hard terms and conditions.The ERD official said the government would utilise part of the fund to support the export sectors, which have been hard hit by the global economic recession, and partly for minimising the budget deficit.The ADB has approved $500 million loan for the Philippines first from its $3.0 billion “counter cyclical support facility fund” last week to support the fiscal stimulus efforts of developing member countries’

Source: Financial Express

Read Full Post »

Padma Bridge cost may hit $2.0b-The largest infrastructure project to be made of steel

The cost of the Padma multi-purpose bridge is likely to hit two billion dollars as experts and consultants have decided to build the country’s biggest construction project with steel. Officials said the consulting firm Maunsell AECOM finalised the ‘scheme’ design of the bridge based on steel-truss composite and will hand over the plan to the Bangladesh Bridge Authority (BBA) next week. Scheme design is an intermediate layout of a construction project. Architects and civil engineers make detailed construction plan based on this design. “It is now final that the Padma bridge will be made of steel structure,” project director (PD) Rafiqul Islam told FE. He said the government-appointed experts and consultants have unanimously favoured steel structure over concrete to reduce construction time. “Concrete bridge eats up more time than the steel. Still the experts and consultants chose steel in a bid to save valuable time,” Mr. Islam said. The Awami League government wants to finish the construction — one of its priority project — by 2013, a year before its five-year tenure expires. Mohammad Zahid Hosssain Ferdous, secretary in-charge of BBA, said the contractors can build a steel bridge over the Padma in three and a half years, whereas a concrete structure may take at least six years. “The amount of time a steel bridge is going to save will be very crucial for our economy. The saved time means a lot to the economy and the people in southern Bangladesh,” he said. Another official said because of steel structure the project cost is expected to cross the current estimated budget of $ 1.8 billion, which was prepared based on the feasibility study. “The cost may go up by 10 to 20 per cent from the estimated budget if steel is used,” he said preferring anonymity. After the scheme design, experts and consultants will finalise the detailed layout by December this year. Construction will begin by July next year. In the first design, the length of the Padma Multipurpose Bridge, set to be the country’s costliest infrastructure project, has been estimated at 6.15 km and width 21.10 metre. It will be the longest bridge in the country, surpassing the 4.80 km long Jamuna Multipurpose bridge constructed in 1997. It will have four-lane road on the top and a broad-gauge rail lane below, with 150 spans, four-kilometre approach road at Mawa and 12 km in the other side in Madaripur. The World Bank has assured to lend $600 million for the project. The Asian Development Bank said it would provide $ 350 million, Japan International Cooperation Agency of $200 million and Islamic Development Bank of $ 300 million.

Source: Financial Express

Read Full Post »

Govt approves $500m ADB loan

The hard-term loan committee on Sunday approved the ADB’s proposed $500 million loan to be utilised for weathering the impact of the global economic plunge.The hard-term loan committee headed by Finance Minister AMA Muhith accepted it as the country has already been affected by the second round impact of the global economic recession, said a finance ministry official.Head of External Affairs of ADB, Bangladesh office Govinda Bar said the $500million credit has to be repaid within five years with a three-year grace period and the LIBOR-based interest rate will be around 2.8 per cent.The government would sit for negotiation with the Manila-based 67-member donor on August 27-28 in Dhaka, he said.The ADB has already given assurance of giving US$500 million to the government from its “Counter-Cyclical Support Facility Fund” to fight the adverse impact of the global economic recession on the economy of Bangladesh.”If the negotiations are completed successfully we are expecting disbursement of the $500 million assistance by December this year” the ERD official said.He said the government might utilise a part of the fund to support the export sectors, which had been hard hit by the global economic recession.The government in the current fiscal’s budget has a target of $350 million as budget-support credit from different donors to minimise the fiscal deficit.

Source: Financial Express

Read Full Post »