The Financial Express

Procurement condition slows down India-funded projects

| Updated: November 02, 2020 10:15:39

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The condition to purchase 75 per cent materials from India for projects under the Indian Line of Credits (LoCs) is the main reason for delay in project implementation, according to a virtual review meeting on Wednesday.

Prime Minister's Economic Affairs Adviser Dr. Mashiur Rahman chaired the LoC review meeting, which also pointed out that the lengthy evaluation time taken by the Indian EXIM Bank at different stages is also responsible for the slow progress of the projects.

Sources said the virtual meeting attended by the agencies working on implementation of the LoC projects also alleged that they have to face pressure about compromising specifications of different equipment coming from the Indian side.

"There are many problems being faced both from Bangladesh and Indian sides, but the procurement-related problem has been identified as the major cause," said an official.

He said that mainly the road development projects were suffering the most due to the procurement-related problem in meeting the 75:25 condition set under the LoCs.

Under the three LoCs signed in 2010, 2016 and 2017, around 25 projects are being implemented in the road, rail, power and shipping sectors. Of those, only eight were completed.

Sources said majority of the projects fell far behind their respective schedules with recorded progress of lowest one to two per cent only.

The three projects under the LoC-1 in railway sector have recorded progress of 70 per cent, 17 per cent and 31 per cent after around 10 years of time. Two projects under LoC-2 in the same sector recorded almost nil progress.

In the Road Transport and Highways Division, two projects of purchasing buses and trucks have been completed.

Agencies involved in implementing the projects under LoC-3 were taking time to prepare the development project proposals, the official added.

But the project to purchase equipment and machinery for construction, repair and maintenance of road infrastructures under LoC-2 remained far behind the target.

Sources said that only two per cent financial progress was recorded as the RHD could complete purchase of laboratory equipment package and spot mixing asphalt plant out of total 25 items.

The RHD sources said that apart from bitumen and stones, materials for road construction are available locally. So meeting the 75 target is also increasing the project cost due to imports.

"Actually 40 per cent Indian materials would be enough for the road sector," said an official concerned.

However, meeting sources said, all these issues have been shared with the Indian side too during the LoC review meeting between the two sides.

The agencies attended the meeting included Economic Relations Division, Roads Transport and Highways Division, Bangladesh Railway, Shipping authority and Bangladesh Land Port Authority.

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