Tk13.11 crore was proposed to construct each kilometre of drainage line, which was “extremely high” considering the real costs involved
The Bangladesh Economic Zones Authority (Beza) had sought around Tk9 crore for construction of 8km link road and 36km drain for the proposed Netrokona Economic Zone.
But after the Planning Commission asked for a breakdown of the expenditure and to reduce the project cost, Bangladesh Economic Zone Authority is now seeking an astonishing Tk574 crore to complete the same work. The amount is 65 times higher than the original estimated cost.
It wants Tk100 crore for construction of road and Tk473 crore for the drain.
The rise in the cost for construction of the road and drain lead to increase in the total expenditure for the project to Tk1505 crore from Tk1224 crore. In revision, BEZA however reduced the estimated cost in some components.
When asked about the road and drainage-specific costs, Beza executive member Ashok Kumar Biswas told The Business Standard, "This is a high-quality drain that includes gas and electricity connections. There is no drain in Bangladesh that has this technology. There will be an extra cost to use this new technology."
Regarding the recommendation made by the commission's Project Evaluation Committee (PEC), the Beza official said representatives of the consulting firm will be sent to visit the project area in an effort to lower the project cost.
The second PEC meeting was presided over by Shahin Ahmed Chowdhury, member of the Industry and Energy Division under the Planning Commission; its attendees discovered that Tk13.11 crore was proposed to construct each kilometre of drainage line, which was "extremely high" considering the real costs involved.
New technology for drainage systems
As per the proposal, the project will introduce a two-chamber concrete-made drainage system; the lower chamber will gush wastewater and the upper chamber will be used to install several utility lines.
Planning commission officials said a concrete-made drainage system is not appropriate for industrial areas.
"Drains through which industrial waste passes should be cleaned regularly, which is why they should have removable covers," they said, adding this is essential for allowing waste to pass easily through and to prevent explosions caused by bio-gas.
Commenting on the matter, Architect Iqbal Habib said he was disappointed to hear about the estimated cost of the drain line project.
He said it is very important to estimate the cost of every component of a project through analytical review to hedge the risks of corruption.
"It is possible to build a drainage system and footpath at one-third of the proposed cost," he argued.
Heeding the commission's recommendations
The Commission's Project Evaluation Committee, in its second meeting to discuss the project, again returned the proposal, and suggested a logical expenditure plan be determined after a review.
The Planning Commission asked for an explanation for the rise in the project cost and Beza executive member Ashok explains the estimated cost of the project in the first proposal was low because it was based on a pre-feasibility study.
He said the cost rose after the final feasibility study was completed.
According to the PEC meeting minutes, the Netrokona Economic Zone will be established on almost 500 acres of land to ensure balanced development.
It claims when the project is complete, nearly 50,000 jobs will be created.
However, Planning Commission officials have expressed discontent at the extra cost sought in the second proposal instead of a reduction in costs.
Shahin Ahmed Chowdhury, member of the Planning Commission's Industry and Energy Division, told The Business Standard, "In many ways, the project cost does not seem logical."
"The PEC meeting also suggested a revised plan be submitted after re-considering the said issues, including environmental ones," she added.
She also said the proposal has been returned with some recommendations to lower the costs for some components to logical levels.
"The planning commission will decide on it when the revised development project proposal is available," she added.
A different scenario in other economic zones
Reviewing other ongoing proposals for Beza projects, it was found that Tk68 crore had been allotted to construct water supply, sewerage and drainage systems in 11 economic zones in the country.
In the new proposed projects, another Tk440 crore was allotted to construct drainage and water supply systems.
Planning commission sources said as part of a project to upgrade the road that connects MAG Osmani Airport with Bholaganj in Sylhet, a 29.35-km drain line along with a footpath is being constructed at an estimated cost of Tk23.48 crore.
The construction cost per kilometre, of drain and footpath, in this project is only Tk80 lakh.
However, Beza sought Tk913 crore for water supply and drainage line construction, which was 61 percent of the total project cost.
Beza intends to spend Tk520 crore to acquire and develop land. This sector was allotted 34.58 percent of the funds in the proposal.
No interest in environmental clearance
Beza got the Netrokona project's pre-feasibility and feasibility studies done by the state-owned Institute of Water Modelling. The institute marked it as a red category project, and recommended its environmental and social impacts be evaluated.
At the first PEC meeting, Beza was advised to consider the suggestions. Additionally, the Ministry of Planning recommended evaluating the economic zone's probable impacts on the environment and biodiversity in that area.
As there was no sign of considering the recommendations, it was discussed at the meeting and the ministry suggested adding the environmental "no objection certificate" to the project proposal.
Haor board's consent required
The proposed economic zone includes almost 100 acres of land of Kamal Beel (wetland). Though the Planning Commission suggested excluding the beel area from the project, Beza said it was not possible.
However, Beza representatives stated that proper initiatives will be taken to save the beel.
Planning Commission officials said one-fifth of the Kamal Beel area falls under the economic zone. Within 10 kilometres of the project area, there are other beels, including the: Kuria Beel, Megha Beel, Nalghuria Beel, Hoilda Beel, Jaga Beel and Dharam Beel.
Moreover, the Mogra River flows three kilometres north and four kilometres south, of the selected land.
"Before establishing the economic zone in an area surrounded by rivers and haors, approval from the Bangladesh Haor and Wetland Development Board is required," said an official of the Ministry of Planning.
Ashok Kumar said beel water would be used in the project as a source of surface water.
"There will be initiatives to preserve rainwater. Caution will be maintained to keep the natural course of the beel intact and to preserve the environment," he added.
Project costlier than others
The estimated cost of establishing four economic zones in the country was Tk81.95 crore in 2014.
After increasing the number of zones to 11, the cost jumped to Tk905.32 crore to develop 30,000 acres of land.
Based on the estimation, each economic zone will cost Tk82.30 crore.
Tabled in 2016, the proposed cost of establishing the Jamalpur Economic Zone on 437 acres of land was Tk333 crore. However, the proposed cost of the Netrokona Economic Zone to be built on 500-acres of land, which is 14.42 percent larger than the Jamalpur Economic Zone, is four times higher.
Ashok Kumar told The Business Standard, "It is logical that the cost will increase as the Jamalpur project proposal was submitted four years ago. By this time, the schedule of rates of many organisations have increased."
"Some new technologies will be introduced in the Netrokona project, and this has increased the cost," he added.
The decision to implement the project was taken at the fourth meeting of Beza's governing board on July 27, 2016. It took three years to finalise the project.
He added that after the economic zone is established, local and foreign investment will increase, and employment will be created.
IWM officials unwilling to speak
Beza blames the Institute of Water Modeling (IWM) for the underestimated costs of components for the proposed project, but no officials of the state-owned research agency are willing to comment on this.
Dr M Monowar Hossain, executive director of the IWM told The Business Standard, "I am going to leave the IWM within a few days, that is why I am unable to comment.
He also said the feasibility study was conducted under the leadership of SM Mahbubur Rahman, water resources planning division director of the IWM, and suggested he be contacted. Director Mahbubur Rahman could not be contacted as he neither received the phone call nor met this correspondent at his office.