The disbursement of funds for projects funded by the Japan International Cooperation Agency (JICA) for Bangladesh has slowed down because of slack implementation.
So far only 42 per cent of the funds, amounting to 680.4 million US Dollars, has been disbursed so far in this Japanese fiscal year (April 2019 – March 2020). However, the targeted disbursement was $1.62 billion for this period to implement 31 projects, according to the Economic Relations Division (ERD).
A high-level portfolio review meeting on JICA's Official Development Assistance loan programme was held on 23 December 2019 at the ERD.
Hitoshi Hirata, the chief representative of JICA, was present at the meeting which was chaired by ERD Secretary Monowar Ahmed. It was attended by project directors and officials of project implementing agencies of different ministries and divisions.
The minutes of the meeting reveal that only 8 out of 31 projects are on track. These are the Khulna Water Supply project, the Jamuna Railway Bridge construction project, National Power Transmission Network Development, Natural Gas Efficiency, Kanchpur & Meghna Gumti second Bridges Construction, Dhaka Mass Rapid Transit Development (MRT line-6), Dhaka Chattogram Power Grid Strengthening Project, and the Energy Efficiency and Conservation project.
Four projects, namely the Disaster Risk Management Enhancement, Dhaka Underground Substation, Matarbari Port Development and Dhaka Mass Rapid Transit Development Project (Line-5) have not been given any funds yet. The other 19 projects are lagging behind target.
The minutes of the meeting also said that the implementation of three projects is far behind target. Those projects are Inclusive City Governance, Haor Flood Management, and Livelihood Investment and Urban Building Safety project. Only 3.8 percent of the funds have been spent on these three projects so far because of slow implementation.
JICA officials said that in accordance with JICA's social and environmental guidelines, it is important to pay compensation to the people affected by land acquisition without delay.
However, the process of paying compensation is very slow for some important projects, especially for the Kalna Bridge Construction project. As per the JICA policy, the disbursement of the funds was stopped because audit observations of The Foreign Aided Projects Audit Directorate (FAPAD) were not settled for some projects.
Hitoshi Hirata pointed out that the current progress of Japanese ODA loan projects is not satisfactory, and an in-depth discussion is needed to overcome this situation.
The ERD secretary said, "If we are to achieve our target, we need to expedite the implementation of the projects." He requested the project executing ministries and divisions to accelerate implementation and make an effort to fully utilise the $1.62 billion allocation.
Muhammad Ashraf Ali Faruk, joint secretary of the ERD, told The Business Standard, that they are very concerned about JICA's disbursement. But they hope the disbursement will increase in the last quarter of the Japanese fiscal year. The ERD has also asked the implementation agencies to speed up the work.
The minutes also said that some projects have been suffering from land acquisition problems. Those projects are the Cross Border Road Improvement project, the Chattogram City Outer Ring Road Project, and the Matarbari Ulta Super Critical Coal Fired Power Project.
The ERD will write to the concerned deputy commissioners to accelerate the land acquisition and compensation process. And it will also arrange another meeting with FAPAD, JICA and the project officials who are facing long pending audit issues.
On the basis of the decisions taken at the meeting, the Ministry of Shipping has been requested to prepare the project proposal of the Matarbari Port Development project. The loan agreement for the project was signed on 14 June 2018.
Chittagong Port Authority (CPA) will submit the purchase proposal of the Matarbari Port Development project to the Cabinet Committee on Government Purchase by January 2020.
The CPA submitted a proposal to the Planning Commission to build a seaport at Matarbari in Cox's Bazar district with a loan from Japan after it abandoned a plan to build a deep-sea port just 25 kilometers away at Sonadia with Chinese financial assistance.
Matarbari Port will be built at an estimated cost of Tk 18,580.60 crore. JICA will provide Tk 13, 252 crore, the Government of Bangladesh will provide Tk 2,739.89 crore and the CPA will contribute Tk 2,587.86 crore of the total amount.
According to the proposal, two jetties with a capacity of handling 8,000 TUEs (Twenty-foot Equivalent Units) would be readied at Matarbari by 2026. The jetties would make it possible for Chittagong Port to handle more than three times the 2,500 TUEs that it handles daily now.
The meeting also decided that the Dhaka Mass Transit Company Ltd – the implementing agency of the metro rail project – will do more to enforce safety measures to reduce accidents during construction. The DMTCL will also appoint the project director and other staff required for the MRT-5 route.