After years of sluggish work, construction of the first Dhaka Elevated Expressway is likely to gain pace soon, as the problem over funding the much-anticipated project has been solved, officials said.
Two Chinese companies will start disbursing Tk 7,318 crore, out of Tk 8,940.18 crore of the construction cost of the project from next month, they said.
Two deals were inked in this regard yesterday.
As per the new deadline, the construction work of its first phase -- Airport to Banani Rail Crossing -- will be completed by this October while the second phase, from Banani Rail Crossing to Moghbazar, will end by October next year. The third and the final phase -- from Moghbazar to Kutubkhali on Dhaka-Chattogram Highway -- will be completed in October 2022.
"As the funding-related issue is over, we hope the work will get momentum and will move quickly towards its completion," Road Transport and Bridges Minster Obaidul Quader said at the contract signing ceremony, at Setu Bhaban in the capital.
Bangladesh Bridge Authority (BBA) had signed a deal with Italian-Thai Development Public Company in January 2011 to build the 47km expressway, with 19.73km main line stretching from Shahjalal International Airport to Kutubkhali, under public-private-partnership at a cost of Tk 8,703 crore.
Once completed, it would help people cross Dhaka without facing the huge traffic congestion within the city, at the cost of a toll.
The deal was revised and signed again in December 2013, with the cost revised at Tk 8,940 crore after bringing several changes to the design.
The government is to spend Tk 4,885 crore on land acquisition, resettlement and relocation of utility service lines, meaning the total cost of the project is Tk 13,825 crore.
But the scheme faltered time and again over the years, mainly due to the failure of the private investor-- Ital-Thai -- to manage funds for the project, the government's delay in handing over the project, and problems related to land acquisition, officials involved with the project said.
Amid uncertainty over funds, BBA issued the work order to the private partner in March 2018, marking the beginning of a 25-year concession era, including three-and-a-half years' construction period, they said.
The government was able to hand over the entire land of first segment only in 2017, due to complications in land acquisition, resettlement and relocation of utility network.
In the meantime, Italian-Thai, in its attempt to manage funds, handed over 49 percent of its share to two Chinese companies -- China Shandong International Economic and Technical Corporation Group (34 percent) and Sino Hydro Corporation Ltd (15 percent).
"The two new shareholders actually helped Ital-Thai manage funds for the project," a project official said.
In March last year, Italian-Thai signed loan agreement with The Export-Import Bank of China (EXIM) for Tk 3,918 crore and Industrial and Commercial Bank of China (ICBC) for Tk 3,400 crore, amounting the total at Tk 7,318 crore.
Yesterday, BBA, First Dhaka Elevated Expressway Company Ltd (FDEECL) and Citibank NA Dhaka Branch, on behalf of EXIM and ICBC, signed a direct agreement, while PPP Unit of Finance Division, FDEECL and Citibank signed Viability Gap Financing agreement.
After the contract singing, Bridges Division Secretary and Executive Director of BBA Belayet Hossain, hoped the work would be expedited after the loan agreements, and would complete work within the deadline.
"Many dubbed it as a 'sink project'. But this is no more a 'sink project'. It would get momentum now," he said.
Obaidul Quader, also the general secretary of ruling Awami League, said due to the slow pace of the project, many raised questions whether the project would see light at all.
"I want to thank Italian-Thai for managing fund after long efforts, and thus the project would get momentum now," he added.
The overall progress of the project is 18 percent while the first phase has witnessed 55 percent progress.
Project Director AHMS Aktar said they have partially handed over land for second phase and would complete it within March.
They are supposed to hand over land of third phase within March 2021, but would do it before that, he told this newspaper after the programme.
Asked about the complexities over design of the project, he said, "After a meeting with Prime Minster [on Sunday], problem related to design has been solved."