The cost of the four-lane highway project from Ashuganj river port to Akhaura land port has gone up by around $63 million as both India and Bangladesh took up a year each to complete formalities around the project.
Bangladesh has sought the additional amount as a loan from the project partner, India.
The cost of the project, which was initially estimated at $448.68 million, has now gone up to $511.58 million, as the prices of construction materials have increased.
In 2016, when the second line of credit (LOC) agreement of around $2 billion was signed with India, this project was added along with 14 others.
The project work, however, could not be started as India took around one year to give its final consent to it.
After that, it took another year for Bangladesh to complete official formalities to start the work.
Thus, more than two years have gone, but finalising tender evaluation, land acquisition, infrastructure construction and other miscellaneous work of the project are still pending.
"Now the construction firms are demanding more money than the amount fixed earlier," said Project Director Arun Alo Chakma. The construction firms must be Indian as per the LOC agreement.
Bangladesh is providing $165 million of the total amount for land acquisition and logistics support while India is supposed to supply the rest of the money for the construction of roads.
The Roads and Highways Department will soon send a letter to Indian officials asking for the additional $62.90 million in loans for the project, said Economic Relations Division officials.
The proposal for the additional loan and progress of the project will be discussed during Prime Minister Sheikh Hasina's upcoming visit to India in October, according to Economic Relations Division sources.
This year is the deadline for completing 75 percent work of land acquisition and 25 percent of road construction, Roads and Highways Department sources said.
India wants transit facility from Ashuganj river port to Akhaura land port via a highway stretching 50.58 kilometres. The transit will connect India's Seven Sister States, including Tripura and Assam.
An inland container port has also been constructed in Ashuganj with Indian loans as part of the transit project.