It is a four-year-old company and yet has bagged 105 government projects worth Tk1,100 crore – mainly related to rivers – in 177 locations across the country.
This looks like a success story of entrepreneurship. A story of meteoric rise.
But the fact remains the company in question, Dolly Construction, has not done anything in a large number of these projects, many of which have zero progress.
At least 60 of its projects, deadlines of which expired on June 30 this year, are yet to be completed.
And now the government agencies which awarded it the jobs are in a limbo. Some of them have even moved for cancellation of the contracts.
In the meantime, Dolly has secured Tk640 crore in loans from two state-owned banks – Rupali and Agrani – against the work orders of these projects.
The company is now a headache for the Bangladesh Bank. This is because loans were given to the company through "serious irregularities" as an investigation has found.
The Bangladesh Bank has recently asked both the banks to recover the money from the contractor and asked for an explanation from the Rupali Bank for the irregularities in its loan disbursement to the company.
So, in the end, both the project authorities and the banks are in trouble.
Not only that, many of the projects were vital to protect property from river erosion. These establishments are also at risk.
The 74-year-old MP Dangi Government Primary School is one of them. On the bank of the River Padma in the Charvadrashan of Faridpur, its future is precarious as the river erodes its way closer and closer over the years and is presently flowing only 30 meters away.
A couple of years ago, the river was around four kilometers away from the school. With the school, the entire neighbourhood is now at risk.
The Bangladesh Water Development Board (BWDB) assigned Dolly to protect the bank two and a half years ago but until December this year it has not even started anything.
In the meantime, as the contract expired, the BWDB has moved to cancel the project contract and requested Rupali Bank to forfeit the company's bank guarantee.
Project directors of the schemes that were awarded to Dolly are aghast at the company's performance. The Business Standard talked to four of them and they all said that the performance of Dolly construction is very poor, which is putting them in a lot of stress.
"We are now running after the construction company to complete the work," said Sultan Mahmud, director of two projects for Arial Khan and Padma rivers. "We are giving it a last try as retendering will raise project costs."
"We will now move to take action against Dolly Construction as per the public procurement act and realise compensation from the company," he added.
Md Afzal Hossan, director general of the Implementation Monitoring and Evaluation Division (IMED), said, "We've recently inspected the Padma and Arial Khan rivers development works in Faridpur.
"The incomplete works of Dolly Construction will pose threats to the completed works of other contractors. This is because if one portion of a river bank protection remains incomplete, then the full project will be useless."
The IMED will ask the authorities concerned to take action against Dolly Construction, he added.
Forty-two-year-old "self-made businessman" Nasir Uddin, founder-managing director of Dolly, however blamed the government for delaying payment which caused delay in project implementation.
He further said that his company had to suspend work due to the pandemic.
However, his statement does not match what other contractors say.
For instance, contractor Khandaker Shahin Ahmed got river bank protection work worth Tk15.35 crore under the Padma River project. He got the work order in November last year and the tenure of the contract was until June next year. But, the contractor has already completed the work and got full payment.
When contacted, Shahin Ahmed said he did not face any payment delay under the project.
Same fate for other projects
Another project on the River Arial Khan in Faridpur district faced a similar fate where Dolly was supposed to do river bank protection work. Some 22 months down the line, the work is yet to start in one location.
In five more locations, its work progress is less than 20%. The delay has led to river erosion, affecting houses along the banks.
The situations in all other projects where Dolly Construction got work orders are similar.
Dolly alone bagged 45 works under the Border Rivers Bank Protection and Development Project out of total 77 work orders through direct procurement method, meaning it did not have to participate in any tender.
The value of the total package was Tk467 crore, of which Dolly got Tk315-crore worth of works.
Now the progress of these works is between 3% and 27% even after the contracts expired in June this year, according to the project directors.
The Business Standard visited project sites in Lalmonirhat district where Dolly construction got bank revetment work--a river bank protection structure to protect against rushing water-- of the River Dharla at Mogolhat BGB Camp.
The contract expired in June this year but the construction company did not mobilise materials to the working sites in three locations of the project.
Md Mijanur Rahman, executive engineer of the BWDB in Lalmonirhat, said the contractor will be replaced as there is no physical progress on the construction sites.
Expressing dissatisfaction over the performance of Dolly Construction, Nabo Kumar Chowdhury, director of the border river project said there is no progress at 45 sites where Dolly is working while the performances of other contractors are satisfactory.
"We are repeatedly raising the alarm about Dolly's poor performance but the project duration was extended till April next year considering the pandemic situation," he said. "We have asked them to start the work by 24 December this year or else we will cancel the work order."
When asked about the delay, Dolly's MD Nasir Uddin gave the excuse of the pandemic and payment delay for slow progress of work.
In response to this claim, project director Sultan Mahmud said payment is released based on the implementation of a work order.
Irregularities in loan disbursement
Despite its sluggish work, getting money from state banks was easy for Dolly Construction.
For instance, in the year 2017, the management of Rupali Bank approved and disbursed a loan of Tk50 crore, including bank guarantee, to Dolly Construction beyond its authorised ceiling ignoring board decision.
The Bangladesh Bank served a show cause notice on Rupali Bank, asking it to explain the issue of providing the Tk50-crore loan violating rules and recover the money from the contractor.
The central bank also asked the bank to conduct a detailed investigation into a company, Udoy Trade, of Dolly Group that was given a Tk20 crore loan.
The Bangladesh Bank in its investigation found massive irregularities in loan approval and disbursement to Dolly Construction during the years 2016-2019.
When contacted, Md Golam Mortuza, general manager of Rupali Bank, said they are negotiating with the client to adjust loans following the central bank's instruction.
However, the client may seek time as it doesn't have the capacity to repay the loans at this moment, he said.
The Motijheel corporate branch of Rupali Bank gave Tk525 crore in total loans to Dolly Construction.
The central bank investigation found that the bank provided loans to the construction company even when it did not have a work order.
In some cases, the loan assessment committee of the bank took approval of loan proposals from the board hiding irregularities of the construction company and its defaulter status. Such an act proves that there was a relation between the construction company and the bank's management, which is corruption, said the investigation report.
The investigation also found that the construction company was given out loans even without completing the land mortgaging process as collateral.
When contacted Md Ataur Rahman Prodhan, the then managing director of Rupali Bank, said there were no irregularities in loan approval and disbursement against Dolly Construction.
"In some cases, the bank guarantee part was given as a loan which is allowed in banking norms. There may be some audit objections which is normal in banking business," said Prodhan who is now managing director of Sonali Bank.