Metro rail cost goes up $1b

Foreign funding for the metro rail project in the capital might be delayed for a year, as the government appears unable to convey to the donor agency within this month its decision on the air force-suggested route diversion.
Besides, various alterations to the route alignment already increased the project cost by one billion US dollars putting the figure at $2.7 billion, said officials of the government and the donor agency.
The government has to officially convey its decision on the latest route realignment proposal to Japan International Cooperation Agency (Jica), the lone financier of the project, by September 30 to avail the funding, said a Jica official on Monday, preferring anonymity.
Otherwise the fund allocation cannot be endorsed in the current fiscal year of Japan, causing deferment for a year.
Bangladesh Air Force objected to Bijoy Sarani portion of the metro rail route on the plea that it will hinder operations of Tejgaon airfield, and suggested its diversion along Sangsad Avenue through Khamarbari, occupying a stretch of Jatiya Sangsad Bhaban complex.
Experts on the project's technical steering committee however termed the objection unfounded.
Jica committed to providing a soft loan of 1.7 billion dollars at 0.01 percent interest rate for the project. It intended to start the feasibility study by December and hold financial negotiations early next year.
The route realignment along Sangsad Avenue has to be approved by the cabinet the same way it endorsed the original alignment, said Communications Minister Syed Abul Hossain on Tuesday.
The government has to seek consent of the finance and planning ministries, the parliament secretariat, and environmentalists to go for the Khamarbari alternative before conveying the final decision officially to Jica, he said.
"Above all, we have to get it endorsed by the prime minister," the minister added.
The government's aim is to start the project work within its tenure, he said.
Already agreed upon alterations to the alignment include relocation of the metro rail's depot from Pallabi to Uttara, a five-kilometre extension of length between Pallabi and Uttara Third Phase, and a route change from Dhaka University to Bangladesh Bank.
Bangladesh Army objected to the depot in Pallabi and suggested its relocation towards Uttara.
"Changes to the alignment and length have caused the increase in cost of the project," said Abul Hossain.
"The route along Bijoy Sarani is the best option, as it will not require land acquisition or building demolition," said the Jica official.
Dhaka Transport Coordination Board, owning agency of the project, itself has to arrange for the social and environmental assessment of the proposed Khamarbari route, as Jica's two and a half years contract with its consultant ended in August.