Sluggish implementation of ADP projects
Monday, 5 November 2007
THE condition of underdevelopment in an economy can be compared to a malignant tumour in a human body. The affliction has too many gaping wounds to be treated by a single course of medication. Likewise underdevelopment has countless number of problems to be addressed in one go. However, there is a difference between the ways a doctor treats human patients and the donors advise as well as provide aid to the ailing developing economies.
Bangladesh is a classic case in this respect. Donors, whether bilateral or multilateral, are very articulate here about their various pieces of advice, criticisms as well as commitments for generous aid to get out of the curse of poverty and underdevelopment. Oddly enough, despite the fact that that the successive governments here remained so responsive to the criticisms, suggestions and recommendations from the development partners and, often to a degree at that, the actual amount of aid flowing into the economy from the donors did not often match their commitments.
If one takes a look at the report on the pace of implementing projects under the Annual Development Programme (ADP) during the first four months of the current fiscal, the glaring discrepancy between the aid pledges and their disbursement will become evident. At a review meeting of the ministry of finance, the statistics on the implementation of 36 foreign-aided projects provided by the Economic Relations Division (ERD) showed that between July and August, the donors could disburse only about US$63 million against the total commitment of around US$ 324.60 for the July-September period of current fiscal. The reasons shown for the poor flow of aid against those projects, it has been said, are inefficiency in project implementation, procrastination in taking decision and procedural complexities in fund disbursement by the donor agencies.
Complexities are involved in both disbursement of fund and implementation of aided projects. Of the afore-mentioned 36 big foreign-aided projects, 13 are concerned with power. The slow pace of aid disbursement as well as project implementation poses a serious risk for the prospect of resolving the existing power crisis in the country in the near future. Needless to say, the inadequate power infrastructure of the country is a big hurdle to the growth of the economy. The development partners, too, have often expressed their concern about the existing power production and distribution regime and have come up with their various recommendation packages and commitment for financial assistance to overcome the situation. But despite all these reasons for reassurance, what are the realities on the ground?
Appointment of consultants for the projects, preparation of tender documents and compilation of the reports on the expenditure of the project money, which are parts of the entire process to use aid money, are taking extraordinary amount of time. But the recipients of the aid from Asian Development Bank (ADB), World Bank (WB), German aid (KFW) and the like have to go through all these steps. The situation is comparable to what happens to the decision making process of our own bureaucracy. Interestingly though, the development partners including the multi-lateral donors are very critical of the local bureaucracy and its tardiness in decision-making.
Small wonder the 13 power divisions projects under the ADP have been performing poorly. Different project implementing agencies under the division have spent only Tk.714.2 million from their own sources against total foreign allocation of around Tk 16 billion for the 13 projects. Unfortunately, the project implementing agencies have so far failed to get any fund from Asian Development Bank, the World Bank, the DFID of UK, German agency KFW and China. Under such circumstances, it is not surprising that the first four months of the FY 2007-08 do not speak well for the prospect of achieving the ADP target for the current year.
Bangladesh is a classic case in this respect. Donors, whether bilateral or multilateral, are very articulate here about their various pieces of advice, criticisms as well as commitments for generous aid to get out of the curse of poverty and underdevelopment. Oddly enough, despite the fact that that the successive governments here remained so responsive to the criticisms, suggestions and recommendations from the development partners and, often to a degree at that, the actual amount of aid flowing into the economy from the donors did not often match their commitments.
If one takes a look at the report on the pace of implementing projects under the Annual Development Programme (ADP) during the first four months of the current fiscal, the glaring discrepancy between the aid pledges and their disbursement will become evident. At a review meeting of the ministry of finance, the statistics on the implementation of 36 foreign-aided projects provided by the Economic Relations Division (ERD) showed that between July and August, the donors could disburse only about US$63 million against the total commitment of around US$ 324.60 for the July-September period of current fiscal. The reasons shown for the poor flow of aid against those projects, it has been said, are inefficiency in project implementation, procrastination in taking decision and procedural complexities in fund disbursement by the donor agencies.
Complexities are involved in both disbursement of fund and implementation of aided projects. Of the afore-mentioned 36 big foreign-aided projects, 13 are concerned with power. The slow pace of aid disbursement as well as project implementation poses a serious risk for the prospect of resolving the existing power crisis in the country in the near future. Needless to say, the inadequate power infrastructure of the country is a big hurdle to the growth of the economy. The development partners, too, have often expressed their concern about the existing power production and distribution regime and have come up with their various recommendation packages and commitment for financial assistance to overcome the situation. But despite all these reasons for reassurance, what are the realities on the ground?
Appointment of consultants for the projects, preparation of tender documents and compilation of the reports on the expenditure of the project money, which are parts of the entire process to use aid money, are taking extraordinary amount of time. But the recipients of the aid from Asian Development Bank (ADB), World Bank (WB), German aid (KFW) and the like have to go through all these steps. The situation is comparable to what happens to the decision making process of our own bureaucracy. Interestingly though, the development partners including the multi-lateral donors are very critical of the local bureaucracy and its tardiness in decision-making.
Small wonder the 13 power divisions projects under the ADP have been performing poorly. Different project implementing agencies under the division have spent only Tk.714.2 million from their own sources against total foreign allocation of around Tk 16 billion for the 13 projects. Unfortunately, the project implementing agencies have so far failed to get any fund from Asian Development Bank, the World Bank, the DFID of UK, German agency KFW and China. Under such circumstances, it is not surprising that the first four months of the FY 2007-08 do not speak well for the prospect of achieving the ADP target for the current year.