The economically disadvantaged northern part of Bangladesh will get a major economic shot in its arm in three to five years with the completion of a four-lane highway and two land ports.
According to an Asian Development Bank (ADB) expert, the $5 billion South Asia Sub-regional Economic Cooperation (SASEC) road connectivity initiative will create the premise for industrialisation and wider cross-border trade with Bhutan, Nepal and India.
The heavy traffic congestions that waste huge man-hours on the way from Dhaka to the north will become a matter of the past as the project will double traffic flow capacity.
Under the ADB-funded project, the government is upgrading the Dhaka-Rangpur highway to four lanes from two lanes, and will upgrade the roads connecting two land ports in Burimari and Banglabandha.
The government has already upgraded the Burimari port, increasing its capacity by two folds. It is now handling 300 trucks coming from India, Bhutan and Nepal, every day.
The Banglabandha port is the only port that Bangladesh uses to do trade with India, Nepal and Bhutan. It handles 250 trucks every day at present.
An official of Bangladesh Land Port Authority told The Business Standard the port’s capacity to handle trucks will double in the next three to four years.
At an estimated cost of $1.2 billion, a project to upgrade the 124km Rangpur-Burimari road is nearly finalised and ready to kick off next year, said Roads and Highways Department officials.
They said the expansion work of the 195km Rangpur-Dinajpur-Thakurgaon-Banglabandha road will not begin before 2022 as the project is still in its primary stage. This project, under which Banglabandha land port’s infrastructure will be developed, will cost around $2 billion.
An economic and financial analysis by the ADB reveals that the economic internal rate of return (EIRR) of the improved road networks will be as high as 18.4%. It says the annual traffic growth on the road will be 6.9% for goods and 6.4% for passengers.
The existing two-lane highway between Dhaka and Rangpur has the capacity to handle 10,000 vehicles per day. But it is already overburdened with 20,000 vehicles, resulting in daily gridlocks.
“The benefits of the improved road network will be huge if we can turn it into a full-fledged economic corridor by providing facilities such as gas and electricity supply for relocation of industries or a new industrial set-up along the corridor,” Khondaker Golam Moazzem, research director of the Centre for Policy Dialogue (CPD), told The Business Standard.
He suggested that the government make a plan in this regard. “Otherwise, the land along the corridor will be grabbed haphazardly, damaging potential investment and industrialisaton.”
Regarding trade boost through Burimari and Banglabandha land ports, Moazzem said: “There will certainly be an increase in the export and import volumes, especially with Bhutan and Nepal. Linking the second largest Mongla sea port with the corridor will create further scope for international trade with the two landlocked countries through the underutilised port. All these will benefit Bangladesh.”
Bangladesh’s trade volume with Bhutan and Nepal is very low. In 2018, export to Bhutan was $419 million, and to Nepal $34 million, according to the Ministry of Commerce. Bangladesh’s import from Bhutan was $4.4 million and $2.9 million was from Nepal.
SASEC is an initiative that aims to bring together Bangladesh, Bhutan, India, the Maldives, Myanmar, Nepal and Sri Lanka in a project-based partnership in order to promote regional prosperity, improve economic opportunities, and build a better quality of life by developing connectivity.
“This is a very important initiative in terms of boosting the road network efficiency, economic development of the northwest region of Bangladesh, and sub-regional trade and transport,” ADB Country Director Manmohan Parkash told The Business Standard.
He said the overall intra-regional travel in terms of passengers and freight has been growing steadily, although transport and trading costs are still affected by poor road infrastructure.
“Similarly, cross-border trade is also hampered because of limited efficiency of the land ports. The SASEC initiative will enable efficient and safe transport within the country, and also with India, Bhutan and Nepal,” added Manmohan.
The northwest region saw an economic uplift after the opening of the Jamuna bridge back in 1998 because of the region’s connectivity with the capital, frequent movement of people and establishment of some industries. However, development stalled after a while.
“The expected investment and development did not happen in the region because of poor infrastructure, inadequate business facilities and, of course, the lack of a development plan,” observed Moazzem, who is an industrial economist with expertise in trade-related matters and regional connectivity.
Improvement of the northwest corridor is important because it is the main route for the proposed seamless passenger, cargo and private traffic movement among the four countries under a motor vehicle agreement signed by Bangladesh, Bhutan, India and Nepal (BBIN) in 2015. It is also one of the proposed routes of the Asian Highway.
The Dhaka-Rangpur road is being elevated to four lanes in two phases. In the first phase, the 70km Joydebpur-Chandra-Elenga road is being expanded and 81% of the work has already been completed.
“We have a plan to finish the first phase by June next year,” said ABM Sertajur Rahman, execurive engineer of the Roads and Highways Department.
The second phase to expand the 190km road from Elenga to Rangpur via Hatikumrul began in March this year. It is expected to be completed by 2021.
"The most important component of the initiative is separate lanes on either side of the road for slow-moving vehicles, which will help ensure a hassle-free traffic movement on the main road," said Sertajur.
“There will be overpasses, underpasses and flyovers in all the intersections and markets along the road to ensure that vehicles are moving without any hassle.”