The objective of the Project is to promote economic growth by improving the performance of the railway sector. This will be done by (i) implementing a program of organizational and policy reforms to improve BR's commercial orientation; and (ii) financing priority investments to overcome capacity bottlenecks in sectors where such investments are both economically and financially viable e.g. the Dhaka-Chittagong corridor.
|Project Name||MFF - Railway Sector Investment Program (Facility Concept)|
|Project Type / Modality of Assistance||Loan
|Source of Funding / Amount||
|Strategic Agendas||Inclusive economic growth
|Drivers of Change||Governance and capacity development
|Sector / Subsector||
Transport / Transport policies and institutional development
|Gender Equity and Mainstreaming||No gender elements|
|Description||The objective of the Project is to promote economic growth by improving the performance of the railway sector. This will be done by (i) implementing a program of organizational and policy reforms to improve BR's commercial orientation; and (ii) financing priority investments to overcome capacity bottlenecks in sectors where such investments are both economically and financially viable e.g. the Dhaka-Chittagong corridor.|
|Project Rationale and Linkage to Country/Regional Strategy||Because of its location, Bangladesh is well placed to act as a hub for subregional transport linking together Bhutan, India, and Nepal more effectively, providing access to the ports in Mongla and in Chittagong and offering transit routes for India to its eastern states. While trade is expected to increase among these countries during the next decade, improved trade facilitation and expansion of transport infrastructure, specifically road and rail links, will be crucial to meet the expected increase in transport demand, particularly for freight. Rail traffic between Bangladesh and India is currently growing at 40% per year and now represents the largest traffic carried by Bangladesh Railway (BR) at about 65%. While there is large potential for further increase in international traffic, this traffic is, however placing considerable pressure on the existing rail network in Bangladesh, which has many limitations, specifically with respect to sidings and freight terminals, and is constrained by the meter-gauge track network on the eastern side of Jamuna river in Bangladesh and the use of broad-gauge track by Indian Railways. Another major constraint is the outdated operational procedures and cumbersome administrative arrangements at rail border crossings between Bangladesh and India.|
|Impact||Promote sustainable national economic growth and poverty reduction in Bangladesh. it will achieve this by improving rail transport efficiency and capacity.|
|Description of Outcome||Improve the performance of the railways sector through enhanced efficiency|
|Progress Toward Outcome||Tranche 1 was approved on 13 Feb 2007, which includes the doubling of Tongi-Bhairab Bazar down line, and the BR Reform Program. Tranche 2 was approved on 22 December 2011. It will finance the funding gap in the Tongi Bhairab Bazar Double Track subproject; the rehabilitation of yards and extension of loops at different stations in the Darsana -Ishurdi- Sirajganj Bazar section; the upgrading of Signaling at 11 Stations between Ishurdi and Darsana; and construction supervision consulting services. Tranche 3 was approved on 9 December 2013. This will finance the cost of 50 Broad Gauge Passenger Coaches and 100 Meter Gauge passenger coaches for Bangladesh Railway's main line network.|
|Description of Project Outputs||
BR becomes a commercially focused rail service provider
BR corporate governance is improved
BR safety record is improved
|Status of Implementation Progress (Outputs, Activities, and Issues)||
Tranches 1, 2 and 3 have been approved on 13 Feb 2007, 22 December 2011, and 9 December 2013, respectively, and are now ongoing.
Tranche 1 has two components, i) investment component(L 2316) and ii) reform component (L 2317)
Loan 2316: The contract for "Construction Of Double Line Track From Tongi To Bhairab Bazar including Signalling on Dhaka-Chittagong" was awarded on 27 July 2011. Construction of the Tongi-Bhairab Bazar Double Track (64 km) is under implementation and expected to be completed by June 2015. The physical progress of the project is 85% as of 31 December 2014. All procurements have been completed.
Loan 2317: The software for enterprise resource planning and safety equipment have been procured, and requisite training was completed in 2014. Installation and commissioning of various computer, hardware and networking equipment were completed in December 2014. Procurement of videoconferencing equipment and recruitment of the consultants for Enterprise Resource Planning (ERP) software implementation are ongoing. Ministry of Railways (MoR) approved the "Recommendation on Tariff Structure of Bangladesh" report on 9 December 2014. Activities on implementation of Tariff Structure (Tariff Reform) are ongoing. MoR has given in-principle approval for the corporatization of container services on 16 April 2014. The proposal was brought up at the Cabinet Division but has been returned to MoR with the advice of getting comments from the Ministry of Public Administration and Finance. The proposal is being reviewed by both Ministries.
All contracts under Tranche 2 have been awarded, including two in 2014.
The overall progress accomplishment of the contractor of signaling contract is 22%. The contractor has started construction of equipment, battery and generator rooms at 3 stations--Paksey, Chuadanga and Munshigonj through engagement of local sub-contractors.
The overall progress of the loop lines contract is 38.5%. Almost all the test issues including dynamic load test and pulsating test issues for steel sleepers are resolved and the contractor has started procuring at the site.
Major part of Loan 2845 ($150 million) is being used for additional financing as part of the investment component subproject (TBDLP) of Tranche 1.
As of 31 December 2014, the procurement of 100 meter gauge railway and of 50 broad gauge railway passenger carriages have been completed. Contract signing was done on 27 November 2014 and ADB received the copies on 8 December 2014.
|Summary of Environmental and Social Aspects|
|Stakeholder Communication, Participation, and Consultation|
|During Project Design|
|During Project Implementation|
International and domestic consulting services will assist the Bangladesh Railway (BR) to implement the reform and investment components. It is estimated that under the sample subproject, a total of 1,090 person-months (260 international and 830 domestic) will be recruited for the following consulting services: (i) preparation of non-core subprojects, except the Chinkiastana-Laksam section which will be prepared by BR itself, (ii) detailed design and construction supervision of the sample subproject, and (iii) the re-rating study of the Jamuna Multipurpose Bridge to recommend measures to increase the rail loading capacity of the bridge.
Another three consultancy contracts financed under this loan will be necessary to help implement the reform program, i.e. (i) implementation of the operational effectiveness improvement component, (ii) preparation of BR asset register, implementation of financial and accounting system as well as human resources planning component; and (iii) legal consultant. All consultants financed under the loan will be selected and engaged using ADB's quality and cost-based selection (QCBS) procedures for recruiting firms under the full technical proposal (FTP) and ADB's procedures for recruiting individual consultants in accordance with ADB's Guidelines on the Use of Consultants and other arrangements satisfactory to ADB on the engagement of domestic consultants.
|Procurement||All contracts will be International Competitive Bidding (ICB) and will be procured in accordance with ADB's Guidelines for Procurement and Government Public Procurement Regulations 2003, provided that in the event of any inconsistencies, ADB's Guidelines for Procurement shall prevail. For the sample subproject, two contracts (tracks and signaling) of civil works, supply and installation of equipment will be procured through the ICB procedure. Contract packages for additional non-core subprojects will be decided during project implementation, based on the approach used for the sample subproject.|
|Responsible ADB Officer||Islam, Mohammad Nazrul|
|Responsible ADB Department||South Asia Department|
|Responsible ADB Division||Bangladesh Resident Mission|
16 Abdul Gani Road Bangladesh Railway, Rail Bhaban, Dhaka, Bangladesh
|Concept Clearance||06 Jun 2000|
|Fact Finding||30 May 2004 to 10 Jun 2004|
|MRM||15 Jul 2004|
|Approval||10 Oct 2006|
|Last Review Mission||-|
|PDS Creation Date||28 Feb 2006|
|Last PDS Update||31 Mar 2015|
MFF Facility Concept 0004-BAN
|Financing Plan||Loan Utilization|
|Total (Amount in US$ million)||Date||ADB||Others||Net Percentage|
|Project Cost||537.50||Cumulative Contract Awards|
|Financing Plan/TA Utilization||Cumulative Disbursements|
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