The Bridge saga
On September 21 the World Bank (WB), through a press release, revived the $1.2 billion loan for the Padma Bridge project after the Bangladesh government fulfilled all the conditions. Revival of a loan after cancellation is a rarity in WB's history. It was revived because both sides were able to grasp realities on the ground to come to an understanding to facilitate the bridge project.
The WB is not an ordinary bank -- its proper name is "International Bank for Reconstruction and Development -- since it has the responsibility of lifting billions of inhabitants of the world's poor countries out of poverty.
Given the above background, the WB could not but re-consider the loan when all of its conditions had been met by the government. If it had not, it would go against its charter of duties. At the same time, the Bangladesh government came to the view that the best option was to seek soft loan from the WB for the bridge by fulfilling all the conditions.
It may be recalled that WB approved loan on February 24, 2011 and the government signed a loan agreement on April 28. In August, the WB raised allegations of corruption. The government rejected graft allegations of the WB and no action as suggested by the WB was taken. WB suspended the loan on September 13 of that year.
After September, there was a tug of war of words through exchanges of letters between the two sides for eight months, but it proved futile as the government could not convince the WB to lift suspension of the loan.
In June 2012 intense negotiations started between the government and the WB. The WB set four conditions, one of them being placing of all public officials, including a minister and PM's adviser, on leave until the investigation was completed. The government did not act with regard to the minister and the adviser and the WB cancelled the loan on June 29.
The reaction from some senior government leaders following the cancellation was unfortunate as they played to the gallery and even alleged that there was corruption in the WB. The whole scenario was presented to the public as if it was a case of prestige for Bangladesh. Bangladesh is a member of the WB and has an alternate director there.
Furthermore, some government leaders considered the idea of building the bridge with our own funds or even with costly Malaysian help, thus sending confusing signals to donor agencies, including the WB, as to whether Bangladesh government needed the loan from the WB.
Finance Minister A. M. A. Muhith must be credited for realising that it was not only a case of cancellation of loan per se that was at stake. The greater stake was the reputation of the government. He was determined to revive the loan against all odds and thus restore the reputation of the government by complying with all conditions.
The finance minister invested his valuable time and energy to prevail upon the government to fulfill all the conditions, especially persuading the economic adviser to take leave. The adviser went on leave from September 17.
Professor Gowher Rizvi, PM's adviser on international affairs, went to Washington on 16th evening with the letter of leave and submitted it to the WB, thus complying with all the conditions. Both the finance minister and Gowher Rizvi must be commended for their hard work in reviving the loan for the dream Padma Bridge project.
It is appreciated that the prime minister saw the need for putting the country above individuals to fulfill one of her main election pledges, thus strengthening the base support of her party in the 21 south and western districts because the bridge will contribute significantly towards facilitating social, economic and industrial development of the region that has a population of about 50 million. The bridge is also a vital component for lifting Bangladesh to middle-income country status by 2021.
The Padma Bridge will be a multipurpose road-rail bridge of 6.15 km over the Padma River. Out of the total cost of the project (about $3 billion), it is estimated that about $2.1 billion will be injected into the economy and the rest will be spent on imports and consultancy.
A big project costing $3 billion will not only have multiplier effects on the economy but will also be a huge boon for the people. Some economists believe that by facilitating transportation across the river, the Padma Bridge will lead to greater integration of regional markets within the Bangladeshi national economy. GDP growth is expected to increase by 1.5% to 2%.
Corruption is an evil phenomenon and exists in all countries, but it is in the developing world that its effects are most destructive because it hurts the poor disproportionately. What the WB wanted was a full and fair investigation of the corruption allegations under Bangladesh's law, and Anti-Corruption Commission (ACC) is now ready to work with the WB's panel of experts.
In future, whenever any corruption allegation is raised, the government will have to take responsibility for promptly conducting full and fair investigation to ascertain the truth. This is more so because Bangladesh has been a party to the UN Convention Against Corruption since 2007.
Since almost one year has been lost, the people expect that both parties will implement the construction of the bridge with minimum procedural delays.