Govt weighs options to raise Padma bridge funds from own sources
The government is considering different options to raise Tk 4,485 crore ($650 million) from internal sources to start the construction of the country's largest bridge, which will cost Tk 12,420 crore.
International lenders will provide $1.15 billion, according to a plan.
The options include converting the Padma bridge project into a company to raise funds from the stock market, imposing levy and surcharge, and financing from the annual development programme.
The options were discussed at a meeting in Dhaka yesterday, based on a World Bank estimate.
“We are examining various options to meet the gap,” said Finance Adviser AB Mirza Azizul Islam after the meeting, also attended by Communications Adviser Ghulam Quader.
To meet the gap, Tk 1,600 crore may be raised through own finance from Bangladesh Bridge Authority, and levy and surcharges. The remaining Tk 2,885 crore may be provided from ADP in phases.
About the plan to convert the bridge project into a company, the communications ministry has already taken a decision to send a proposal to the Cabinet Division.
“We hope the construction of Padma Bridge will be completed by fiscal 2014-15. The work will start after the preparation of a detailed design of the project, which is now in progress,” the finance adviser said.
The proposed Padma Bridge, having rail, gas, telephone and electricity connections, will be constructed at the Mawa-Jajira point of Munshiganj and Shariatpur districts to connect the southwestern region with the capital and other parts of the country.
According to officials who attended the meeting sources, four international lenders have expressed interest to provide $1.15 billion for the construction. The WB will fund $300 million while three other agencies -- Asian Development Bank, JBIC (Japan Bank for International Cooperation) and IDB (Islamic Development Bank) -- will lend $350 million, $200 million and $300 million.
The interest rate or service charges for loans are different for different donors: 0.75 percent for WB, 0.01 percent for JBIC, 3.30 percent for IDB and 3.49 percent for ADB.
However, which lending agency will be the lead donor is yet to be finalised, although opinions are there that WB will lead the project.
“We have not taken any decision of assigning any of the organisations as a lead donor,” Aziz said.
The Executive Committee of National Economic Council approved construction of the Padma Bridge in 2007.
A feasibility study carried out for the Jamuna Multipurpose Bridge Authority by the Japan International Cooperation Agency concluded that the best design alternative was a pre-stressed concrete extradosed box girder design.
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