The World Bank, the Asian Infrastructure Investment Bank, and the KfW Development Bank are due to provide Tk12,980 crore for four projects
The Prime Minister's Office has moved to accelerate the approval of projects that are likely to receive foreign fundings – aiming at reviving the economy by increasing cash flow during the ongoing novel coronavirus pandemic.
The PMO has already ordered the ministries concerned to send revised proposals of four development projects to the Planning Commission and submit them to the Executive Committee of the National Economic Council (Ecnec) for urgent approval.
A memorandum of understanding has been signed with the World Bank about financing the four projects but the agreement has not been inked yet.
The World Bank, the Asian Infrastructure Investment Bank, and Germany's KfW Development Bank are due to provide Tk12,980 crore in loans and grants for these four projects.
The government is keen to sign agreements with the foreign organisations, including the World Bank, soon after the projects are approved by Ecnec.
The government has adopted a policy of increasing the flow of money to revive the stagnant economy in the face of the novel coronavirus pandemic. As part of this, incentive packages of more than Tk1 lakh crore have been announced for various sectors.
However, due to fears of declining revenue collection, disbursement from the government's own funding for low-priority projects has been suspended. In this situation, the government is keen to continue development activities by utilising foreign loans.
The four projects would improve the living standards of the Rohingya community in eight upazilas of Cox's Bazar by providing pure drinking water, improving health care and preventing various risks; build economic corridors using the Padma Bridge; encourage private investments; and improve the government's digital skills and cyber security.
Principal Secretary to the prime minister Ahmad Kaikaus recently met top executives of the ministries concerned and officials of the Economic Relations Division to sign a loan agreement with the World Bank after quickly finalising the revised project proposals and having those approved by Ecnec.
He told the meeting that the projects for which agreements with the World Bank are still waiting to be signed must be submitted to and approved by Ecnec.
He called on everyone to work diligently from their own positions to this end.
Instead of taking on new projects to get foreign loan assistance during the pandemic, the government should focus on implementing the existing foreign-aided projects that have implementation hurdles
Dr Zahid Hussain, former lead economist of the World Bank's Dhaka office, told The Business Standard, "Instead of taking on new projects to get foreign loan assistance during the pandemic, the government should focus on implementing the existing foreign-aided projects that have implementation hurdles.
"About $60 billion is stuck in our pipeline. It can be used only if the existing problems regarding implementation of the projects are solved. However, instead of doing that, officials are more eager to take on new projects. This is because at the beginning of a project, there are opportunities to travel abroad, buy cars and hire people. Once that is done, officials become reluctant to implement the project and start taking on new ones again," he explained.
Details of the four projects
The Emergency Multi-Sector Rohingya Crisis Response Project is being expanded to six more upazilas of Cox's Bazar besides Teknaf and Ukhiya to reduce various risks, improve living standards of the Rohingya people displaced from Myanmar, arrange pure drinking water, and improve the health system.
The government's own funding for the Tk1,987 crore project is Tk20.36 crore. The remaining Tk1,967 crore would come from foreign aid. The World Bank would provide an additional Tk847.5 crore while KfW Development Bank would give Tk70.16 crore for the project.
The project would be implemented by the Local Government Engineering Department and the Local Government Division from December 2018 to June 2024.
Its DPP was sent back to the Planning Commission on 6 September after a meeting of the Project Evaluation Committee in June suggested some revisions.
Economic Relations Division (ERD) Secretary Fatima Yasmin said the agreement with the World Bank could not be signed as the Ecnec had not yet approved the project.
Dr Zahid said the project to be implemented across Teknaf is likely to be implemented soon because various foreign organisations would be involved in it.
The government will develop an economic corridor by upgrading the Bhomra-Satkhira-Navaran-Jashore-Jhenidah-Bonpara-Hatikumrul national highway from two to four lanes to accelerate regional and international trade, and to ensure the desired socio-economic development of the southern part of the country by using the infrastructure and strategic facilities of the Padma Bridge.
In addition to developing the 260km road, investment will be made in the project area in relevant public welfare schemes, including agricultural and civic infrastructure development, under the Western Economic Corridor and Regional Enhancement programme. The project will be implemented with a loan of Tk4,237.5 crore from the World Bank and Asian Infrastructure Investment Bank.
The project will be implemented by the Road Transport and Highways Division and the Local Government Division. The Road Transport and Highways Division sent the RDPP to the Planning Commission on September 7, but the Local Government Division has not yet sent it.
The Prime Minister's Office has directed the Local Government Division to quickly send the RDPP to the Planning Commission. It has also directed the commission to quickly submit the project to the Ecnec for approval.
The Cabinet Committee on Government Purchase has decided to formulate a master plan for road and highway infrastructure after the prime minister recently emphasised the importance of maintaining old roads instead of building new ones.
The government has been discussing for a long time whether there is a need to build new roads in the country. In this case, however, the old two-lane roads will be upgraded to four lanes. Many road projects are underway, and their implementation is very slow
Dr Zahid said the government has been discussing for a long time whether there is a need to build new roads in the country. "In this case, however, the old two-lane roads will be upgraded to four lanes. Many road projects are underway, and their implementation is very slow. If that also happens in this case, taking on a project to get foreign funding during the pandemic will not be very fruitful."
The government has taken on the Bangladesh Private Investment and Digital Entrepreneurship project to encourage private investment in industry and trade, create employment and ensure sustainable development. The latter would be achieved by establishing economic zones and software technology parks in the country. The project will be implemented by the Bangladesh Economic Zones Authority (Beza) and the hi-tech park authority with a Tk4,237.5 crore loan from the World Bank.
There have been two Project Evaluation Committee meetings on the DPP of this project. Beza sent the RDPP to the Planning Commission on 10 September. However, the hi-tech park authority has not yet done that.
As a result, the project is not being tabled to the Ecnec for approval. Dr Kaikaus has directed that these tasks be completed rapidly.
In addition, the ICT Division will implement Bangladesh Enhancing Digital Government and Economy project with financial assistance of Tk2,500.13 crore from the World Bank. The objective of the project is to improve the digital skills and cyber security of the government, and to increase employment for skilled workers in the field of information technology.
The ICT Division was asked to revise and re-present the DPP after some inconsistencies were detected during the preliminary review at the Project Evaluation Committee meeting in June. The RDPP has not yet been sent to the Planning Commission.
The Prime Minister's Office has directed the ICT Division and the Planning Commission to present the RDPP to the Ecnec soon.