Road projects suffer as India delays credit

Munima Sultana Roads and Highways Department (RHD) is unlikely to meet its annual development programme (ADP) target due to India's delay in disbursing credit to key infrastructures, officials said Thursday. They said India has held up project aid worth US$131.37 million (Tk10.51 billion) for four transport projects including roads and rail overpass, drastically slowing down development spending at the RHD. The aid was part of the $1.0 billion credit line India had extended to Bangladesh after relations between the two neighbours improved since the Awami League-led government took over power in January 2009. RHD officials said the department had completed all paper works and formalities regarding the four projects and hoped that New Delhi would release the concessional loan in the first quarter of the fiscal. "Almost six months have gone since the start of the new fiscal, but there is no sign of Indian government's approval for credit for the projects. They are totally silent over the issues," said an official. The four projects are: improvement of Senarbadi land port road, development of Sabrum land port connecting road from Barayarhat, improvement of Lalmonirhat-Burimari road and construction of Jurain rail crossing overpass. "These four projects alone make up a quarter of our department's ADP spending this fiscal. As a result, our development expenditure has slowed down drastically," he said. "We want clear answer. But they are not saying `yes' or `no' to these projects. And the delay has left the department's ADP spending in a mess," said another official. The two officials spoke on condition of anonymity as they are not authorised to talk to media. Officials at the Economic Relations Department said some efforts have been made to prod India's state-owned Exim Bank to release the project aid but it has not yet received any response. Dhaka has also requested New Delhi to relax the latter's condition of procurement of 85 per cent goods from India in case of road projects, arguing that this provision would not be feasible for such schemes. The communications ministry recently held a meeting with the RHD in an effort to resolve the funding problems and speed up project implementation. A senior RHD official said the government has already taken decision to exclude Jurain flyover project from the Indian credit line and construct it from the government's own resources. He said the department was seeking other donors to fund the three road projects. "We'll send a letter to ERD to look for new donors. If we fail to find alternative sources, we'll have to seek extra-government fund to cover up the loss in meeting the ADP target," he added. In the current fiscal year, the RHD was allotted Tk 18.28 billion including Tk 7.74 billion as project aid.