Foot dragging, it's on

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Shamsul Huq Zahid
Many tend to liken a government in this part of the world to a thick-skinned animal called rhinoceros that usually reacts late if anything pinches its skin.
Such an assumption, at times, appears to be true, particularly when it comes to decision making on urgent issues. A case in point is the World Bank's proposal on signing revised deals on 26 projects involving an expenditure of $2.5 billion.
The multilateral lender, according to a report published in the FE early this week, sent a proposal to the Economic Relations Division (ERD) in the latter part of November last seeking to revise deals on 26 of its funded projects in Bangladesh.
The Bank wanted the government to sign the revised deals following amendments to certain provisions of the Public Procurement Act (PPA). It has serious reservations about some of the amendments such as introduction of lottery system to break a tie in bidding, awarding works to inexperienced contractors and rejecting bids priced above or below 5.0 per cent of the government's estimated value.
The WB and some other leading multilateral donors had tried in vain to dissuade the government from amending the PPA. The country mission of the Bank in June and July last cautioned the government about serious implications of the PPA amendments on its funded projects. The WB vice-president for South Asia personally also wrote to the Prime Minister informing the latter about the possible ill effects of the PPA amendments.
Before sending the proposal, the WB had asked the government to suspend local procurement in the case of the 26 projects until the revised deals were signed. The projects include $350 million Siddirganj peaking power plant, $150 million emergency cyclone recovery and restoration work, $210 million rural transport improvement project, $149 million Dhaka supply and sanitation project, $300 million health, nutrition and population sector programme, $250 million enterprise growth and modernisation project, $150 million second primary education development programme and $102 million water management and improvement project.
The WB proposal, as claimed by the ERD officials, was sent to the law ministry for vetting in early December. But the Secretary, ERD, has informed the FE that they were yet to get any decision from the law ministry.
The reason for the delay in conveying its decision by the law ministry is not known. It could be that the ministry is overworked. For, scores of files reach the ministry everyday seeking legal opinion. Then again the ministry might have reservation about the contents of the revised deals sent by the WB for countersignature to the ERD.
But the fact remains that the WB proposal on revised deals deserved immediate attention because its importance in the context of development project implementation.
The delay has been taking heavy toll on the economy, in terms of public sector investment and employment. According to ERD officials, the government received only $188 million in the first five months of the current fiscal year from the WB, the largest development partner of Bangladesh.
A number of government agencies entrusted with the task of development project implementation have reported slow progress in their work because of the WB restriction on procurement in projects financed by it.
The fallouts from the PPA amendments do not augur well for the economy, particularly when the rate of implementation of the Tk 305 billion ADP was only 28 per cent in the first half of the current fiscal year.
Some people, however, might feel like appreciating the government's courage to defy the 'villainous' donor like the WB and stick to its decision, right or wrong, about amending the PPA.
But some others have already questioned the justification behind the amendments to the PPA, which, they consider as a world-class public procurement law. Moreover, the country's ability to finance a large annual development programme, seen as one of the very important vehicles to achieve higher economic growth and poverty alleviation, without external assistance has also come into focus on a number of occasions.
It is difficult to predict whether or not the country would have enough resources of its own to finance fully the development works in the future. But, at least, in the near and medium-terms, the aid dependence would continue.
As a matter of principle, the government should try hard to convince the donors about dropping conditions detrimental to national interests and accept the ones aimed at ensuring transparency and accountability at all levels of project implementation.