ADP projects drag for years, shooting up costs

Thirteen years on, renovation of the Pahartali Carriage and Wagon Repair Workshop is yet to be completed. 

In order to improve and develop the 60-year-old worn out workshop in Chattogram, Bangladesh Railway authorities undertook a renovation project in July 1, 2007. Deadline for the project was set as June 2017.

The government has to count more than double the allocated expenses for the delay. The total cost shot up from Tk146 crore to Tk318 crore in a period of 13 years.

Railway officials said they could not begin the project in time due to a delay in getting loans from donor organisations. Later, the shortage of manpower and budget further hindered the progress.

In the fiscal year 2015-16, Tk46 crore was allocated for the project, Tk14 crore in FY2017-18 and Tk61 crore in FY2018-19 under the Annual Development Programme (ADP). 

Of the total allocated Tk318 crore, the Japanese Debt Relief Grant Assistance-Counterpart Fund (DRGA-CF) lent Tk175 crore. The remaining Tk143 crore came from the government exchequer.

There are 31 more ADP projects which have been running for 10 to 15 years.

Analysis of the ADP financial expenses for FY2019-20 shows that some of the ongoing projects will not end before 12 years.

"The government has undertaken more projects, including megaprojects, than the available resources. Hence, it is not possible for them to allocate funds as per the demand," said Dr AB Mirza Azizul Islam, former finance and planning advisor to the caretaker government.

"Small projects get small fund allocations, which is not useful to complete the project," said 

He added that the project implementing organisations spend 45 percent of the allocated amount in the first nine months of a year. They spend 45 percent more in the remaining three months. While rushing in the last three months, they fail to maintain quality. 

Most of the projects are revised three or four times halfway into development. 

"Delay in implementing the project within the deadline pushes up the cost of these projects by three to four times. This actually wastes public money," said Dr Mirza.

According to the Implementation Monitoring and Evaluation Division (IMED) under the planning ministry, 70 to 75 percent of the ADP projects have missed their deadlines and the quality of completed projects were questionable. 

Another report published by the Planning Commission last month said that the projects of ministries and divisions are not under the Medium-Term Budget Framework (MTBF), which hampers fair funding. 

In the current fiscal year, most ministries and divisions have unnecessarily taken up new projects. 

As a result, the government failed to allocate funds demanded, prolonging the deadline of the projects. 

To solve this issue, the government has directed the ministries and divisions to undertake projects under the MTBF of FY2019-20, after prioritising the necessity under the high, medium and low categories. 

Every ministry or division is allocated funds for three years under the MTBF, after discussions between the concerned ministry and the Programming Division of the Planning Commission and the Finance Division under the finance ministry. 

The MTBF is approved in the parliament during the budget sessions. But the ministries and divisions violate the MTBF ceiling on taking up new projects.   

Currently, a total of 1,564 projects are running under the Annual Development Programme. Another 1,045 projects are awaiting approval. Of these, the planning commission has marked 477 projects as top priority, 288 as medium and 280 as low priority projects.  

Speaking to The Business Standard, Executive Director of Policy Research Institute Ahsan H Mansur said, "If the ADP projects are not completed within the deadline, it causes a big loss because private investments depend on the government investments."

He further said many implementing organisations are taking big projects despite lacking the capacity to do so. 

For instance, the Bangladesh Small and Cottage Industries Corporation (BSCIC) could not complete its projects even after extending the deadlines many times.

One of the most important BSCIC project is the Savar Tannery Industrial City. The construction of the city began in September 2003 on 200 acres of land in Boliapur, Savar. 

On 17 acres of land, a central waste refinery plant is being set up. The project was supposed to be completed in 2005. 

In the meantime, cost of the project stepped up from Tk175 crores to Tk1,078 crores.     

Ahsan H Mansur said that the project is supposed to end in June 2020, but there is doubt if it will end within the deadline. 

Construction of the third Karnaphuli bridge has also been running for 13 years. The construction of the main bridge was completed in 2010, but road connection, overpasses, culverts and land acquisition are still left. 

The project is supposed to end by December this year. 

The Padma bridge project has also been running for over a decade. Construction was halted for a long time following corruption charges by the World Bank. The bridge was supposed to be completed by December this year but the deadline has been extended till June 2021.  

In Siddhirganj, construction of a 335-megawatt power plant has been running for 13 years. After revising the project in phases, the government signed a construction agreement with Isolux Ingenieria SA of Spain and Samsung C&T Corporation in 2012.  

Due to poor financial condition of Isolux, the progress of the power plant's construction has been very slow. 

Due to the delay of approval from the development partners, many other projects are also taking over a decade to complete, said project sources.  

These include the Khulna-Mongla Railway project funded by India, development of the Cox's Bazar Airport funded by China, and the railway line from Dohazari to Gundum via Cox's Bazar funded by the Asian Development Bank.    

Dr AB Mirza Azizul Islam said the government undertakes projects by considering political benefits. 

"But they should prioritise the necessity of these projects, which would reduce the complexities associated with allocating funds. It will also lessen the tendency of extending deadlines," he added.