Bangladesh-Japan Joint Initiative: PPP projects caught up in myriad problems

Most of the public-private partnership projects that were listed to be implemented under the Bangladesh-Japan joint initiative could not make any significant progress over the last six years because of multiple problems.

The poor progress appears as a major setback for the government's plan to bring huge investment for mega structures under the PPP initiative.

Against the backdrop, the sixth Bangladesh-Japan PPP Platform meeting will be held in Dhaka today.

At the meeting, the Bangladesh Bridge Authority (BBA) and the Roads and Highways Department (RHD) will place five to six new projects, said officials.

Following an agreement signed between the Public-Private Partnership Authority (PPPA) in Bangladesh and the Ministry of Land, Infrastructure, Transport, and Tourism of Japan in 2017, Japanese companies will invest under the G-to-G PPP model without taking part in any bidding.

At the first meeting of the Japan-Bangladesh Joint PPP Platform in December 2017, Bangladesh's PPPA sought multi-billion-dollar support from Japan for implementing 18 infrastructure projects.

But Japanese companies showed interest in investing $6.4 billion in six projects: a multi-modal transport hub at Kamalapur and Airport Railway stations, an inland container depot at Dhirasram in Gazipur, and the improvement of Chattogram-Cox's Bazar highway, outer ring road around Dhaka and Mass Rapid Transit (MRT) Line-2.

As things stand, five of the projects have been dropped or are in the process of being dropped from the G-to-G PPP list, according to five officials of PPPA, RHD, and Bangladesh Railway.

The project for constructing the multi-modal transport hub at Airport Railway Station was dropped after the fourth PPP platform meeting while the project of Inland Container Depot at Dhirasram in Gazipur was earlier dropped, they said.

The projects for the improvement of Chattogram-Cox's Bazar highway, building an outer ring road around Dhaka and MRT Line-2 were discussed in the fifth platform meeting held in Japan in October 2022.

An RHD representative told the fifth platform meeting that JICA will provide a loan for a separate project undertaken to remove bottlenecks at five points on the Chattogram-Cox's Bazar highway, read the meeting minutes.

Implementation of the highway improvement project will be faster if it is done with a JICA loan instead of PPP. Besides, it would eliminate the risk of design uniformity and synchronisation, it read.

At the meeting, a representative of Road Transport and Highways Division said they disagreed with the recommendation of the preliminary study carried out by the selected Japanese companies on MRT Line-2.

The study said a major portion of the cost should be borne by the Bangladesh government, the minutes read.

Both sides agreed to drop the project from the PPP scheme, according to the the minutes.

Regarding the improvement of an outer ring road, the Japanese side said they were interested in developing one of the three segments of the road.

But the Bangladesh side said all three segments are under one PPP project and it is not possible to exclude one part and make a separate PPP project because it would not be viable, the minutes mentioned.

In this situation, this project is also likely to be dropped from the list at the sixth platform meeting, an official said.

Another project for upgrading the Nabinagar-Manikganj-Paturia highway into an expressway also came up for discussion in the fifth platform meeting.

But after the opening of Padma Bridge, passenger traffic on the route has decreased by 30 percent and freight traffic by 10 percent, an RHD representative said at the meeting.

The project is not likely to be considered a PPP scheme for now, said the official wishing not to be named.

Asked about the reasons, an RHD official said most of the projects were included in the list without carrying out any studies. So, when studies were done, the projects were found not to be viable for PPP projects, leading to their exclusion from the list, he said.

Two officials from BR and PPPA echoed the same.

Referring to the Chattogram-Cox's Bazar highway project, the RHD official said a change in government decision is another reason behind the poor show.

Besides, some Japanese companies involved in the process need more engagement, he added.

The PPPA official said some implementing agencies are not interested in executing their projects under PPP scheme as it takes more time at the planning level than a regular project.

"It is not true that we could not make significant progress regarding the projects," said Mushfiqur Rahman, chief executive officer of PPPA.

They have been holding platform meetings to discuss the projects.

Detailed studies are being carried out on the projects.

"We are on track. As detailed studies are being carried out by both sides, it takes time," he told The Daily Star yesterday.

In reply to a query about the delay in starting the physical work, he said: "These are all mega projects. So, it's taking time. But we are very much optimistic about the projects."

Among the first six projects, the project for building a multi-modal transport hub at Kamalapur Station has made progress.

BR has already appointed an Indian joint venture company as a consultant for carrying out technical and feasibility studies and preparing documents for financial negotiation with Japanese companies, said Al Fattah Md Masudur Rahman, the BR official responsible for the project.

Besides, the Japanese sub-working group led by Kajima Corporation will place the pre-masterplan of the project at today's meeting, he told The Daily Star.

Although the project for operation and maintenance of the third terminal of the Hazrat Shahjalal International Airport was not discussed in the last meeting, the issue would come up in this meeting, the PPP official said.

Another project titled "Chattogram Metropolitan Sewerage Project for Patenga Catchment" that was discussed in the last meeting will also be talked over there, he added.

Meanwhile, the Bangladesh Bridge Authority will place more than one project at today's meeting for consideration, Bridges Secretary Monjur Hossain told this newspaper.

BBA sources said they will put forward four to five projects, including a tunnel or bridge on Cox's Bazar-Maheshkhali route and several subway routes in Dhaka.

RHD will also place a project for building two bridges: the Tora Bridge on the Dhaka-Aricha highway and the second Bhairab Bridge.