Fails timely takeoff, authority seeks 62pc cost hike

A potential venture like an inland container and bulk terminal misses time and turns wasteful as the project authority has sought over 62-percent cost hike, sources say.
The plea for more than doubling the cost comes four years after the project for building the cargo terminal at Khanpur off the capital was given the go, officials have said.
Thus, the Tk 3.92-billion project will now cost as high as Tk 6.36 billion and the tenure extended until June 2027 after time expiry, with total funds coming from the public exchequer, they added.
The Project Evaluation Committee (PEC) under the Planning Commission recently evaluated the 'Narayanganj Khanpur Inland Container and Bulk Terminal' project which got the Executive Committee of the National Economic Council (ECNEC) nod in December 2019 for implementation between January 2020 and June 2023.
The ECNEC had put a condition that the government funds for the project will be given as loan instead of grants where 1.0-percent charge will be applicable to the implementing agency--Bangladesh Inland Water Transport Authority (BIWTA).
The project director informed the PEC meeting that it took over three years to sign loan deal with finance division and appointment of consulting firm for design and supervision of the project.
Asked about the reasons behind the project-cost escalation, he said during the preparation of development project proforma (DPP) the project was designed based on conceptual design of the terminal and the cost was estimated the way.
Later, another design was prepared based on steering committee's decision, terminal's master plan and feasibility study, which led to the project cost hike, says the project director.
Moreover, he says, the cost of the project was estimated in line with the rate schedule of 2014 which later changed thrice so far. The project cost now increased due to calculation under latest rate schedule.
The PEC meeting, presided over by Dr Mohammad Emdad Ullah Mian, Member, Physical Infrastructure Division, Planning Commission, also discussed that the construction cost of multipurpose jetty had been proposed to be enhanced to Tk 1.34 billion from the previous cost of Tk 456 million.
The project director says now the jetty has been designed in line with international and regional standards where live-load in each square meter has been considered at five tonnes instead of two tonnes.
The PEC meeting, as such, asked the project director to recheck the cost and increase it rationally.
Also, the PEC meeting found that in the revised DPP the warehouse construction and riverbank-and side-slope protection cost had been proposed too high which needs a recheck.
Contacted, a Planning Commission official told the FE that the proposed project-cost hike is considered excessive and so has been asked to be rechecked before restructuring the revised DPP and send to the commission again.
He said the project authority has also been asked to get consent of the finance division as the project cost "is increasing significantly".
The Public-Private Partnership (PPP) authority on its website mentioned that nearly 70 per cent of containers at the Chittagong port originate or are destined for Dhaka, of which only 17 per cent are transported by road and rail.
The remaining containers are transported to and from Dhaka by truck that results in severe congestion on the Dhaka-Chittagong highway and causes significant delays in shipment. As an alternative, inland water transport (IWT) system has a good potential considering that there is only one Inland Container Depot (ICD) in Dhaka connected through railway to Chittagong port.
Once the Khanpur container and bulk terminal is built, carrying boxes by waterway will help reduce congestion on highways and also the transportation cost.
The terminal will have the annual handling capacity of 80,000 TEUs (twenty-foot equivalent units) of containers.

[email protected]