Padma bridge gets big boost as donors hint at funding $2b
Friday, 20 November 2009
Munima Sultana
Leading donors have hinted at scaling up lending for the road-cum-rail Padma Bridge, removing a major obstacle to the construction of the country's largest infrastructure project, officials said Thursday.
Officials said donors including the anti-poverty lenders World Bank and Asian Development Bank have recently expressed their interest to hike up their loans up to US$2.00 billion for the project, or more than two-thirds of estimated cost of construction.
The assurance comes as a big relief for the government, which has been struggling to raise enough funds to get the $2.7 billion project launched by the middle of next year.
The donors, which also included the Japan International Cooperation Agency (JICA) and Islamic Development Bank (IDB), had earlier pledged to cough up only $1.2 billion dollars for the 6.15-kilometre bridge.
It left the government with a challenging task to fill up funding gap of $1.5 billion from domestic sources.
In a desperate move, the finance ministry forced to consider raising a big chunk of the money through selling bonds in the share market --- an option considered "not viable" by the World Bank.
But government officials said the uncertainty over funding might end very soon after they got "encouraging words of assurances" from top donors.
"The Bridge Authority held series of meetings with the donors concluded on Wednesday. During the talks, leading donors have hinted that they might enhance soft-loan up to $2.00 billion," said a government official.
"The donors now even want to finance almost the entire cost of the project," he said, preferring anonymity.
He said the World Bank has shown interest to bear major parts of the budget while the ADB hinted that it could increase its contribution significantly.
An official of JICA said the Japanese development lender is also ready to raise its credit, but the decision is dependent on some conditions related to technical aspect of the project.
JICA had assured to provide $ 200 million and Islamic Development Bank $ 300 million.
The cost of country's largest infrastructure project was initially estimated at $1.8 billion but it hit $US2.7 billion dollars on enhanced cost of construction materials and a decision to build the bridge with steel-truss.
Auckland-based Maunsell Aecom, which is designing the project, added electric train tracks, improved safety requirements, wider railway approach bridge and tourism facilities, forcing the authorities to revise the budget upward.
The consulting firm submitted its 'scheme design' of the proposed project to the Bangladesh Bridge Authority in October.
In the first design, the length of the Padma Multipurpose Bridge has been estimated at 6.15 km and width 21.10 metre.
Till now Bangabandhu Multipurpose Bridge over the river Jamuna is the country's largest bridge, with length 4.80 kilometres.
It was constructed in 1997 at a cost nearly one billion dollars.
The Awami League government has made Padma Bridge one of its top priority projects and it wants to finish the construction by 2013, a year before its five-year tenure expires.
Leading donors have hinted at scaling up lending for the road-cum-rail Padma Bridge, removing a major obstacle to the construction of the country's largest infrastructure project, officials said Thursday.
Officials said donors including the anti-poverty lenders World Bank and Asian Development Bank have recently expressed their interest to hike up their loans up to US$2.00 billion for the project, or more than two-thirds of estimated cost of construction.
The assurance comes as a big relief for the government, which has been struggling to raise enough funds to get the $2.7 billion project launched by the middle of next year.
The donors, which also included the Japan International Cooperation Agency (JICA) and Islamic Development Bank (IDB), had earlier pledged to cough up only $1.2 billion dollars for the 6.15-kilometre bridge.
It left the government with a challenging task to fill up funding gap of $1.5 billion from domestic sources.
In a desperate move, the finance ministry forced to consider raising a big chunk of the money through selling bonds in the share market --- an option considered "not viable" by the World Bank.
But government officials said the uncertainty over funding might end very soon after they got "encouraging words of assurances" from top donors.
"The Bridge Authority held series of meetings with the donors concluded on Wednesday. During the talks, leading donors have hinted that they might enhance soft-loan up to $2.00 billion," said a government official.
"The donors now even want to finance almost the entire cost of the project," he said, preferring anonymity.
He said the World Bank has shown interest to bear major parts of the budget while the ADB hinted that it could increase its contribution significantly.
An official of JICA said the Japanese development lender is also ready to raise its credit, but the decision is dependent on some conditions related to technical aspect of the project.
JICA had assured to provide $ 200 million and Islamic Development Bank $ 300 million.
The cost of country's largest infrastructure project was initially estimated at $1.8 billion but it hit $US2.7 billion dollars on enhanced cost of construction materials and a decision to build the bridge with steel-truss.
Auckland-based Maunsell Aecom, which is designing the project, added electric train tracks, improved safety requirements, wider railway approach bridge and tourism facilities, forcing the authorities to revise the budget upward.
The consulting firm submitted its 'scheme design' of the proposed project to the Bangladesh Bridge Authority in October.
In the first design, the length of the Padma Multipurpose Bridge has been estimated at 6.15 km and width 21.10 metre.
Till now Bangabandhu Multipurpose Bridge over the river Jamuna is the country's largest bridge, with length 4.80 kilometres.
It was constructed in 1997 at a cost nearly one billion dollars.
The Awami League government has made Padma Bridge one of its top priority projects and it wants to finish the construction by 2013, a year before its five-year tenure expires.