Chinese co to conduct study again after ADB

The government's latest move to allow a Chinese company to conduct feasibility study afresh on the Dohazari-Cox's Bazar-Ghundum railway line construction work will linger further its execution, thus pushing up the project cost, insiders said on Tuesday.
They said despite having a complete feasibility study, the Bangladesh Railway's (BR) move to allow the Chinese company to start fresh feasibility study will delay the project's implementation further.
A feasibility study has recently been completed with the financial support of the Asian Development Bank (ADB) for constructing the 128-kilometre-long Dohazari-Ramu-Cox's Bazar and Ramu-Gundum (near Myanmar) railway line.
However, BR signed a Memorandum of Understanding (MoU) with China Railway Group Limited (CRGL) in the capital on Monday, allowing it to start feasibility study for the rail-track.
"Under the MoU we will allow the Chinese company to study feasibility. It will take more than one year to complete the study. Then CRGL will convince the Chinese government to mobilise fund for the project. Afterwards we will go for negotiations with the company for awarding contract," said BR general manager (GM) S K Chakrabarty.  
"If everything goes well, we will be able to give contract to CRGL in 2016 for completing the railway line construction work within the next 4-5 years."
When asked about the recently-completed feasibility study, Mr Chakrabarty said the Chinese company will conduct feasibility study afresh with its own effort, as it is likely to construct the 128-km railway line.
He confirmed that the Ministry of Railways (MoR) has now decided to build the proposed railway track with the financial support of China instead of ADB.
BR undertook the railway line project in 2010 at a cost of Tk 18.52 billion, scheduled to be completed by December 2013. The recent study has estimated the project cost at the range between US$1.2 billion and $1.5 billion.
The scheduled project completion period elapsed a year ago, but BR was unable to kick-start the project due to absence of a confirmed foreign financier.
"ADB and China assured Bangladesh of funding the project. We were in a dilemma over selection of one lender for a long time. We awaited decision of the government to select one development partner," the BR GM added.  
During the implementation period between July 2010 and December 2013, the project was struggling due to lack of funding and land acquisition-related complexities.
Mr Chakrabarty said the project was delayed during the last five years mainly due to indecision over selection of a development partner. Besides, land acquisition and some other complexities have also affected its execution.  
Construction of the railway line up to Cox's Bazar, Bangladesh's largest tourism centre, is very imperative to attract thousands of tourists every year. Currently, lack of smooth transport facility from the capital to Cox's Bazar is affecting the country's tourism development, experts said.
Earlier, the Ministry of Finance (MoF) and MoR failed to reach a consensus regarding selection of one development partner from ADB and China, even nearly four years after the project got its approval.
Despite having assurance from ADB for the project, the Prime Minister in her last visit to Beijing sought financial support from China, thus creating fresh complexities in its execution, a MoF official said.
"More than nine months ago, ADB in its current country operation business plan (COBP) included the project for funding. However, BR has recently requested China to finance the same project. It has created new complexities," he also said.
ADB, under a technical assistance project, has been studying feasibility and working for preparing a detailed design for the 128-km railway line from 2012.
The bank in its COBP has kept aside $217 million fund for financing the long-awaited project that will connect Cox's Bazar with Chittagong.
Nevertheless, MoR is going to take help of the Chinese government, bypassing ADB's financing decision, which is an act of immaturity of the government in the field of economic diplomacy, the MoF official opined.
However, a MoR official said: "The proposed Dohazari-Ramu-Gundhum railway line may connect the Chinese city of Kunming through Myanmar territory in the near future. So, we have requested China for funding the project despite ADB's funding assurance."
He also said the overall project cost has already been estimated upward from its preliminary cost due to rise in compensation money, to be provided to the affected people. The government in 2010 estimated Tk 3.00 billion compensation for them, which has increased to nearly Tk 30 billion now.  
"As the project cost has increased, now it needs revision. We will send the revised proposal to the Planning Commission for approval after selection of the development partner by the high-ups," the official added.
Prime Minister Sheikh Hasina inaugurated the project and construction of a railway station at Jhilanja Old Bus Stand in Cox's Bazar in April 2011.
    kabirhumayan10@gmail.com