The Financial Express

Experts raise question about feasibility study

| Updated: July 30, 2021 13:13:35

File photo used for representational purpose. (Collected) File photo used for representational purpose. (Collected)

Revision of infrastructure development projects with both time and cost has become a regular phenomenon, raising questions about the quality of feasibility studies on the projects.

The revisions were being done mainly in terms of time extension and increasing the costs of the projects, officials said.

Economists, engineers and project insiders thought that lack of quality in the feasibility studies created the scope of revision, eventually benefiting the contractors, who won the jobs as the lowest bidders through abiding by the public procurement rule (PPR).

The inefficient studies also result in preparation of faulty tender documents and detailed designs of the projects thus affecting the physical work, they added

Economists also found its adverse impact on the country's economy having resource limitation as billions of taka remains blocked every year in this kind of projects, hindering adequate fund allocation for the important sectors like education and health.

They alleged that the efforts to make the feasibility studies properly is also not visible and no evaluation done during the revision on the internal rate of return (IRR) or economic rate of return (ERR).

It has been found that 80-90 per cent of the development projects particularly under the Ministry of Road Transport and Bridges, Railway, Civil Aviation and Tourism, and Local Government, Rural Development and Cooperatives required revisions at least once during the implementation period.

There were even projects that had to be revised 3-5 times on various grounds.

The Planning Commission after the end of fiscal year 2020-21 also received one fifth of the total 1,785 projects seeking time extension due to inability to complete those by June 2021.

However, many projects under the revised ADP have been awarded at least one revision.

Though many of these projects have been taken  after finding their viability, the implementing agencies like RHD, BR, BBA and LGED had earlier taken the projects either without any feasibility study or departmental study.

Retired engineers of different road and rail sector projects said that the project offices even cannot spend the allocation in a particular fiscal year (FY).

They also observed similar scenarios in cases of mega and large projects, including Padma Multipurpose Bridge (PMB) project, Mass Rapid Transit Line development project, Padma Bridge Rail Link project and Khulna-Mongla Rail link project.

It was also found that the projects like Bangabandhu Railway Bridge project, Hazrat Shahjalal International Airport 3rd Terminal project, Elenga-Hatikamrul-Rangpur four-lane project, Dhaka-Mawa expressway projects etc., were revised before starting their physical work with proposals for significant rise in the cost.

The Elenga-Hatikamrul-Rangpur highway widening project faced huge changes in scope of work and variation despite launching of the project with completed feasibility studies and detailed design.

The Joydevpur-Tangail-Elenga highway four lane project, which was also launched after the feasibility study and detailed design, have gone through revisions for five times with cost escalation.

Recently, the Dhaka-Narayanganj double line project will go for fresh feasibility study at the end of its tenure due to facing problems in land acquisition and technical fault in the line between old and new tracks.

Apart from these, the fate of many projects including Bus Rapid Transit (BRT) from Joydevpur to Airport and Dhaka Elevated Expressway (DEE) is still uncertain due to little progress after passing almost a decade.

The experts said that this happened due to the poor feasibility study.

Dr Ahsan H Mansur, Executive Director of Policy Research Institute (PRI) of Bangladesh, said that the common practice of revisions has proved involvement of disqualified people in the projects as well as lack of proper supervision and monitoring of the work.

"We now see a completed project goes for reconstruction after destroying the built up road, which is a misuse of tax money," he told the FE.

He cited an example of the 300 feet road in Dhaka, which is now in a total mess after completion of the construction due to carrying out the work of lake development on both sides of the road.

Dr Khondaker Golam Moazzem, Research Director of the Center for Policy Dialogue (CPD), said the revision of projects leave a huge impact on the project and economy which is, however, not assessed properly.

He pointed out that engagement of vested interest groups at the project preparation stage, particularly in the development partner funded projects, leads to poor feasibility study for the given condition.

The CPD Research Director also said that the project impact could really be understandable if the IRR or ERR are assessed properly at the time of project revision.

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