Tk 10,690 cr spent for Tk 5,600 cr tunnel

Cost increased almost 91 pc

Zarif Mahmud: Bangabandhu Tunnel has been constructed under the Karnaphuli River in Chittagong with Chinese funding. It is being constructed by China Communication Construction Company (CCCC) on G2G basis. Exim Bank of China has given high interest loans for this. The project, approved in November 2015, has inaugurated yesterday (October 28). However, its cost has doubled since before the start of construction until last January.
It has been found that initially the cost of construction of the tunnel was Tk 5,600.40 crore. However, as of last January, it has increased to Tk 10,689.71 crore. That is, the cost of tunnel construction has increased by Tk 5,089.31 crore or 90.87 percent.
According to Bridge Department sources, the Development Project Proposal (DPP) for the construction of the country’s first tunnel was finalized in December 2014. CCCC and its subsidiary OVE Arup Construction of Hong Kong have jointly verified the feasibility of the project. Based on this, its construction cost was finalised.
At that time, the cost of tunnel construction was estimated at Tk 5,600 crore. However, the Planning Commission returned the DPP at that time as there was no guarantee of funding. Later, the bridge department signed a construction contract with CCCC for the construction of the tunnel.
In June 2015, based on CCCC’s proposal, the cost of the project was increased to Tk 7,784.60 crore. However, the Project Evaluation Committee (PEC) of the Ministry of Planning raised objections to some of the CCCC’s proposals. However, the construction cost did not decrease and instead increased to Tk 8,446.64 crore. The project was approved at that cost in November 2015.
Meanwhile, the construction of the tunnel started after two years due to the delay in the execution of the loan agreement. However, the construction cost of the tunnel increased in 2020 on the pretext of increase in the amount of land acquisition, increase in VAT and tax payment rate, safety and security, relocation of service connection lines etc. At that time the expenditure increased to Tk 9,880.40 crore.
At that time, Exim Bank of China was supposed to give a loan of Tk 5,913.19 to the project. The remaining Tk 3,967.21 crores should be provided from the government funds. China’s debt is to be repaid in 20 years at 2 percent interest. But later on, the loan amount increases.
Tunnel costs have not remained constant since construction began. Among them, once on an urgent basis, a proposal to increase the expenditure of Tk 494.02 crore was given special approval. However, as the increase in construction cost was within five percent of the project cost, it was not sent to the Executive Committee meeting of the National Economic Council (ECNEC). Planning Commission Member (Infrastructure) approved the proposal.
On the other hand, last January, the cost of Bangabandhu Tunnel was increased again. At that time, the construction cost increased to Tk 10,689.71 crore. This includes government funding of Tk 4,619 crore and China Exim Bank loan of Tk 6,700 crore. Reasons for increase in cost are said to be additional money kept in prize contingency sector, increase in cost due to change in foreign currency exchange rate, change in scope of project activities, purchase of service area furniture, electronics, furniture and furnishings, addition/detachment of new parts, VAT & IT growth and extension of project duration.
A notification fixing the toll of the tunnel was issued last July. It can be seen that the minimum toll for crossing the Bangabandhu Tunnel has been set at Tk 200 for private cars, jeeps and pickups. Trucks and trailers have to pay the highest toll. In case of trailer, along with the prescribed toll, an additional Tk 200 should be paid for each axle. However, bikes are not allowed in the tunnel.
Among other vehicles, the toll for microbus is Tk 250, bus (less than 31 seats) Tk 300, bus (more than 32 seats) Tk 400, bus (3 axle) Tk 500, truck (up to 5 tons) Tk 400, truck (5 decimal 01 to 8 ton) Tk 500, truck (8.01 to 11 ton) Tk 600, truck and trailer (3 axles) Tk 800, truck and trailer (4 axle) Tk 1000 and trucks and trailers with more than four axles Tk 1000 with more for each axle.
It should be noted that under the Karnaphuli tunnel project, in addition to the 3.40 km main tunnel, 200 meters of open cut, 195 meters of cut and cover, 550 meters of connecting road and 25 meters of working shaft will be constructed at the eastern (Anowara) end. And at the west (Patenga) end of the tunnel open cut 190 meters, cut and cover 230 meters, connection road 4,080 meters and 25 meters working shaft have been constructed.