Finally, the impossible has become possible.
Padma Bridge, which was a dreamer’s extreme dream, is bridging the mighty Padma River to connect the far south of Bangladesh to the rest of the country, defying naysayers that include me.
I am willingly admitting myself as a naysayer because I had believed that, absent a massive dose of low-cost international financing that included the World Bank, construction of this massive six kilometres-plus bridge would not be possible.
Clearly, I was wrong.
Historical lessons
I was basing my assumptions off of Jamuna Bridge which was constructed more than two decades ago (1998) with international financing, of which the World Bank was a major source. The nearly five kilometre-long Jamuna Bridge was the biggest infrastructure project until that time, which Bangladesh had entered and successfully completed after years of uncertainty over financing and feasibility.
The Padma Bridge was the next mega project -- the concept of which began soon after the North South connector bridge was completed. But unlike Jamuna Bridge which was conceived of before the independence of Bangladesh, the Padma Bridge became a priority after the current administration came to power.
And unlike Jamuna Bridge which took years of planning, feasibility, and economic viability studies, Padma Bridge was put on a fast track. As a result of which, the project was scheduled to begin in the middle of 2011. Most of the projected cost estimated that time at around $2.6 billion was to be financed jointly by the soft lending arm IDA of the World Bank ($1.2 bn), ADB, and Japan, and accordingly tenders were invited for construction.
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Obstacles
But soon obstacles came in the way in the shape of allegations of corruption raised by the World Bank in the tender process. The Bank demanded an independent enquiry into the allegations, naming some individuals, and postponed its loan until completion of the enquiry. The scandal reached a level when a key figure in the alleged corruption (which had yet to be proved) resigned from his job, and another official in charge was dismissed.
But all the while, the government denied culpability for the corruption and boldly announced that the project would continue even if the foreign partners withdrew their financial support.
The work was resumed four years later, entirely on funds arranged from national resources. The corruption scandal came to an unceremonious end when a court in Canada dismissed the charges against the Canadian contractor alleged to have bribed some officials in Bangladesh for lack of credible evidence, in a way affirming the government’s denial of culpability.
So, the completion of Padma Bridge is just not a case of successful conclusion of a dream but also a case of demonstration of determination and grit against odds. True, the project cost has been 30% higher than the original estimate ($3.7bn instead of $2.6bn), but part of it is due to price increase in a span of four years -- from 2011 to 2015 when construction actually started.
But all of this, the total cost, unproved allegations of corruption, and political harassment are now water under the bridge -- the mighty Padma Bridge.
New challenges
The challenges from now on will be financing operation and maintenance of this dream bridge and for similar infrastructure projects that are either in the pipeline or in the planning stage. Economic viability of the project depends on the revenue stream that is expected to come from tolls as in the case of Jamuna bridge -- all of which can go toward operation and maintenance cost without government subsidy, provided the estimated traffic takes place uninterrupted.
And fortunately, unlike Jamuna Bridge, the Padma Bridge is loan-free, requiring no repayment. But what about the plethora of mega-projects that we are now undertaking or planning to undertake?
A summary glance at the mega projects that Bangladesh has in its portfolio now reveals a staggering planned expenditure of nearly $21 bn in ongoing infrastructure projects, which includes Padma Railway Bridge ($4.7 bn), and Dhaka Metro Rail ($12 bn). Other ongoing mega projects are Rooppur Nuclear Power ($12.65 bn), Matarbari Thermal Power ($4.5 bn), and Payra Thermal ($2.48 bn), which are near completion.
There are projects which are in the planning stage but already efforts are there to procure financing for them. These are not only ambitious, but also far too costly and need serious rethinking. Significant among these are Dhaka Subway, Dhaka Chittagong Express Railway, Chittagong-Cox’s Bazar Railway, Chittagong Elevated Expressway, and a second Nuclear Power Plant in the south.
None of the above projects is planned to be financed domestically as the country’s exchequer will be unable to bear the costs, notwithstanding our comfortable foreign currency reserves that are buttressed by remittances from abroad and garment exports. These projects are planned to be financed either on loans from foreign countries or soft term credits.
The bottom line is that we will have to pay up the borrowed sums later. Do our planners expect a miraculous growth in our foreign earnings to pay these new loans?
So, while we celebrate our Padma Bridge construction and financing from our own resources, I am afraid we will not gloat over the mega projects that we have undertaken or will undertake without some apprehension of their deep impact on our finances.
I am sure our financial experts and political leadership have given due diligence on the financial impact of the mega projects and reaching out and receiving foreign financing. But I am afraid in doing so, they may have looked more at the political aspects of dazzling the populace with infrastructure projects comparable with developed countries.
What we want v what we need
Do we need a subway in Dhaka to carry people where we could do with more buses and internal roads? Do we need a high-speed railway like Japan in our country when our railway system is bursting at the seams with an umpteen number of passengers who ride on the rooftop of rail cars? Do we need more power plants when the installed capacity of our existing plants is 40% more than what people consume?
Why can’t we spend more on building and developing our human resources with more institutions that teach skills to equip our unemployed youth for jobs that they cannot do now, home or abroad? Instead of more expressways and an expensive transport system for Dhaka and Chittagong, why not think of regional development focusing on the neglected north?
I know by writing this article I cannot change our current portfolio of mega projects or their focus. But I hope our leaders do take heed of events in Sri Lanka and re-engage their focus on priorities that help a nation in the long run.
We do need roads, bridges, and improvements in our railways and waterways. But what we do not need are mind-boggling expensive projects for political scores. We have shown the world how we could finance a big bridge such as Padma with grit, national pride, and our own resources. This is the way we should go in the future -- choosing projects selectively that provide long term benefits for our people.
Build and develop institutions that our youths can grow and work for the country. Not subway for Dhaka, or high-speed railways a la Japan.
Ziauddin Choudhury has worked in the higher civil service of Bangladesh early in his career, and later for the World Bank in the US.
