Bangladesh Just a Dream?

As Bangladesh faces chal­lenges to con­struct the Padma Bridge, will it agree to the World Bank’s con­di­tions or will the bridge ex­ist only as a blue­print?

Southasia - - Contents - By Ekram Kabir

The coun­try stands at the cross­roads of ei­ther ac­cept­ing the World Bank’s con­di­tions or con­struct­ing the Padma Bridge on its own.

The Bangladeshi au­thor­i­ties term the Padma bridge pro­ject, the ‘dream of the na­tion.’ The coun­try’s long­est bridge, ex­pected to stretch 6.15km long, would con­nect the south-western parts of the coun­try with Dhaka and save hun­dreds of thou­sands of work­ing hours and trans­port costs. Apart from of­fer­ing such fa­cil­i­ties, the Padma Bridge is also ex­pected to change Bangladesh’s south-western eco­nomic land­scape to boost the national econ­omy.

At present, the en­tire re­gion is heav­ily de­pen­dent on ferry ser­vices that con­nect it with the cap­i­tal. Ac­cord­ing to the World Bank, the bridge would save travel time of up to two hours for buses and cars and more than 10 hours for goods trucks. More­over, the in­clu­sion of a rail­way track and pro­vi­sion for telecom­mu­ni­ca­tions, elec­tric­ity and nat­u­ral gas trans­mis­sion would yield added ad­van­tages for the econ­omy.

The Padma Bridge would also raise the eco­nomic and ge­o­graphic promi­nence of the Mongla Port, which presently op­er­ates at a frac­tion of its real ca­pac­ity.

The con­struc­tion work of the bridge at Mawa-Ja­jira point was ex­pected to be­gin by 2012 at a cost of nearly $3 bil­lion. The pro­ject was funded largely by the Asian De­vel­op­ment Bank ( US$615mn), the World Bank ($1.5bn), Ja­pan In­ter­na­tional Co­op­er­a­tion Agency ($415mn) and the Is­lamic De­vel­op­ment Bank ($140mn). Of the to­tal amount, Dhaka was to pro­vide 50 mil­lion taka. How­ever, when ev­ery­thing seemed to be go­ing as planned, the cor­rup­tion scan­dal jeop­ar­dized the fund­ing and the pro­ject’s fu­ture.

The World Bank’s In­tegrity of­fice pro­vided the Bangladesh govern­ment with a re­port on 21 Septem­ber 2011 al­leg­ing that SAHCO, a com­pany named for and con­nected to

the then com­mu­ni­ca­tions min­is­ter, Syed Abul Hos­sain, sought to per­suade com­pa­nies to se­cure the main bridge con­tract. The re­port con­tains al­le­ga­tions by eleven con­fi­den­tial wit­nesses against his com­pany. Hos­sain, how­ever, de­nies any con­flict of in­ter­est in the par­tic­i­pa­tion of SAHCO. In Fe­bru­ary last year, the Anti-Cor­rup­tion Com­mis­sion (ACC) com­pleted its own in­ves­ti­ga­tion into the al­le­ga­tions and con­cluded that there had been no mal­prac­tices.

Mean­while, the coun­try’s anti cor­rup­tion di­vi­sion raided Canada-based SNC-Lavalin’s of­fices in Septem­ber 2011. In April 2012, au­thor­i­ties charged two SNC-Lavalin ex­ec­u­tives for at­tempt­ing to bribe Bangladeshi of­fi­cials in their bid to se­cure a con­sul­tancy con­tract for the Padma Bridge pro­ject.

Even though, the WB sub­mit­ted a re­port on th­ese al­le­ga­tions to the Bangladeshi govern­ment in April 2012, the ACC in­ves­ti­ga­tion into th­ese al­le­ga­tions is still con­tin­u­ing.

How­ever, the WB has tem­po­rar­ily halted the fund­ing process. As in­ves­ti­ga­tions were un­der­way, the Bank trans­formed the pro­ject into a con­di­tional deal. It de­mands that all pub­lic of­fi­cials sus­pected of cor­rup­tion be put on leave im­me­di­ately, a spe­cial in­ves­ti­ga­tions team within the ACC be ap­pointed to in­ves­ti­gate the al­le­ga­tions, a WB panel be al­lowed to have full ac­cess to the in­ves­ti­ga­tion and fi­nanciers be pro­vided with greater over­sight of the pro­ject pro­cure­ment process.

Bangladesh agreed and the in­ves­ti­ga­tions be­gan. How­ever, it did not sus­pend the al­leged of­fi­cials nor pro­vide the WB panel with ac­cess to the ACC in­ves­ti­ga­tion. Af­ter months of ne­go­ti­a­tions, the WB de­cided to can­cel the loan for the Padma Bridge pro­ject. Fol­low­ing this, the Bangladesh govern­ment promptly de­fended the can­cel­la­tion of the pro­ject by rais­ing Bangladeshi na­tion­al­ism. The govern­ment as­sured it could not let a for­eign en­tity

The World Bank’s In­tegrity of­fice pro­vided the Bangladesh govern­ment with a re­port on 21 Septem­ber 2011 al­leg­ing that SAHCO, a com­pany named for and con­nected to the then com­mu­ni­ca­tions min­is­ter, Syed Abul Hos­sain, sought to per­suade com­pa­nies to se­cure the main bridge con­tract.

dic­tate its de­ci­sion mak­ing. Some also sug­gested that the WB can­celled the loan be­cause of the Grameen Bank’s in­volve­ment and to pre­vent the In­ter­na­tional War Crimes Tri­bunals from mov­ing for­ward.

Fol­low­ing the can­cel­la­tion of the pro­ject, in April, Bangladesh signed a MoU with Kuala Lumpur, ac­cord­ing to which Malaysian banks and con­struc­tion com­pa­nies would fi­nance and con­struct the bridge. Ac­cord­ing to the pro­posal, Bangladesh would re­pay the loan at an in­ter­est rate of 6.5 per­cent in 12 years, in­tro­duc­ing stricter terms than those spec­i­fied by the WB. Once the bridge be­came op­er­a­tional, the tolls would re­main high as the Malaysian govern­ment would con­tinue to share the toll rev­enues for an­other fif­teen years.

Al­though Dhaka may have as­sumed a strong anti-World Bank po­si­tion, it soon re­al­ized that it could not com­plete the pro­ject with­out the World Bank’s sup­port. The govern­ment has sought to ad­dress the re­main­ing WB con­cerns, hop­ing to move the pro­ject for­ward. Hos­sain re­signed from the cabi­net in July and the Sec­re­tary of the Padma Bridge, Moshar­raf Hos­sain was sent on leave. The Prime Min­is­ter’s Eco­nomic Ad­vi­sor Moshiur Rah­man, who was the In­tegrity Ad­vi­sor for the pro­ject, is also ex­pected to leave of­fice. Dis­cus­sions and de­bates over the Padma Bridge don’t seem to end here. The WB has banned SNC-Lavalin from hav­ing any in­volve­ment in the pro­ject; while the Cana­dian court has ac­cepted SNC-Lavalin’s case. The court may re­veal the name of the peo­ple al­legedly in­volved in the scan­dal once the trial be­gins. How­ever, it seems that Bangladesh’s or­deal to con­struct the bridge would be un­der the shad­ows of SNC-Lavalin’s cor­rup­tion scan­dals.

All is not lost for Bangladesh yet. The Ja­pan In­ter­na­tional Cor­po­ra­tion Agency (JICA) is will­ing to ini­ti­ate talks on fi­nanc­ing the bridge if Bangladesh comes up with a fresh pro­ject frame­work. Fur­ther­more, Dhaka would be float­ing an in­ter­na­tional ten­der for con­struct­ing the Padma Bridge at the end of June this year.

Af­ter dis­cus­sions, de­bates as well as crit­i­cism, Bangladesh now seems to be on the right track to­wards con­struct­ing the Padma Bridge, with Dhaka mulling over ways to meet the World Bank’s terms and con­di­tions.

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