Bangladesh : Railway Rolling Stock Project

Sovereign Project | 49094-001

The proposed project will improve railway transport capacity in Bangladesh on key corridors such as the Dhaka -Chittagong and Dhaka-Khulna main line corridors by financing additional rolling stock (locomotives, passenger carriages, and related equipment). The new rolling stock will enable Bangladesh Railway to satisfy steadily growing demand and increase its market share.

The impact will be efficient and safe railway transport in Bangladesh, aligned with the Sixth Five-Year Plan (20112015). The outcome will be increased railway transport capacity in the main line network of Bangladesh Railway.

Project Details

  • Project Officer
    Das, Amrita Kumar
    South Asia Department
    Request for information
  • Country/Economy
    Bangladesh
  • Modality
  • Sector
    • Transport
Project Name
Railway Rolling Stock Project
Project Number
49094-001
Country / Economy
  • Bangladesh
Project Status
Closed
Project Type / Modality of Assistance
  • Loan
Source of Funding / Amount
Loan 3301-BAN: Railway Rolling Stock Project
Source Amount
Ordinary capital resources US$ 200.00 million
Strategic Agendas
  • Inclusive economic growth
Drivers of Change
  • Governance and capacity development
Sector / Subsector
  • Transport / Rail transport (non-urban)

Gender
No gender elements
Description

The proposed project will improve railway transport capacity in Bangladesh on key corridors such as the Dhaka -Chittagong and Dhaka-Khulna main line corridors by financing additional rolling stock (locomotives, passenger carriages, and related equipment). The new rolling stock will enable Bangladesh Railway to satisfy steadily growing demand and increase its market share.

The impact will be efficient and safe railway transport in Bangladesh, aligned with the Sixth Five-Year Plan (20112015). The outcome will be increased railway transport capacity in the main line network of Bangladesh Railway.

The project has two outputs. Output 1 comprises the procurement and commissioning of new rolling stock consisting of approximately 264 passenger carriages and 10 diesel electric locomotives for Bangladesh Railway's meter gauge main line network. Output 2 comprises the procurement and commissioning of new equipment consisting of approximately four relief cranes, two train washing plants, and one simulator for loco-master training.

Project Rationale and Linkage to Country/Regional Strategy

Historically, the railway enjoyed a monopoly as a carrier and carried most of the country''s commodities and passengers. With the gradual emergence of road transport, the railway began losing market share, which declined from 30% in 1975 to a mere 4% in 2005 for both passenger and freight transport. Despite a growing demand for transport, Bangladesh Railway''s market share in passenger and freight transport has declined due to a lack of investment in infrastructure and rolling stock (its transport capacity is the same as it was in 1975). Railway travel in Bangladesh is safer, more energy-efficient and reliable, and has a lower environmental impact than other modes of transport. Railway transport is also considered more comfortable than long-distance buses. Intercity trains operated by Bangladesh Railway are very popular. Occupancy is very high, especially in the east zone (98%); intercity trains in the Dhaka-Chittagong corridor are usually sold out. About 40% of Bangladesh Railway''s passengers travel by intercity trains, which account for more than 75% of passenger revenue. The high demand for intercity service in the Dhaka-Chittagong corridors cannot be fully met and no additional trains can be scheduled to tap into the lucrative market for Bangladesh Railway due to insufficient line capacity and rolling stock availability.

The government''s Sixth Five-Year Plan (20112015) includes the improvement of railways as energy efficient multimodal transport systems to reduce carbon emissions. The Railway Sector Master Plan towards 2030, approved in 2013, noted the railway sector must significantly improve its efficiency and service quality, and establish better connectivity in order to survive as a viable mode of transport. The government''s strategy is to increase Bangladesh Railway''s market share from 4% to 15% in freight transport, from 10% to 15% in container transport between Dhaka and Chittagong Port, and from 4% to 10% in passenger transport. The railway will focus on lucrative market segments and provide (i) long-distance passenger traffic via intercity trains, (ii) long-haul freight traffic along selected corridors, and (iii) container traffic (mainly between Dhaka and Chittagong Port). To achieve this, the government is (i) augmenting line capacity along main corridors; (ii) procuring modern locomotives, passenger carriages, and freight wagons; and (iii) reforming Bangladesh Railway, introducing a modern financial management system, improving operation and maintenance, and establishing a human resource management system.

The project is part of ADB''s railway sector development strategy to support a series of investment projects in infrastructure, railway reform, and institutional capacity development to improve overall transport capacity. Adding rolling stock to Bangladesh Railway's fleet will enable it to use its enhanced infrastructure capacity by running additional passenger trains, and thereby satisfy the increasing demand for trips by train. The project is in line with ADB's country partnership strategy for Bangladesh, 20112015, which aims to reduce high transport and logistical costs in support of sustainable and inclusive economic growth by connecting all parts of the country with national and regional markets.

The project is processed as a stand-alone project loan embedded into ADB''s railway sector development strategy and ongoing projects, as the implementation period is comparably short and project readiness is high, with government approvals and bid documents well advanced. ADB financing will ensure timely delivery of a larger number of locomotives and passenger carriages at competitive prices.

Impact

Efficient and safe railway transport in Bangladesh (Sixth Five-Year Plan: 2011-2015)

Project Outcome

Description of Outcome

Railway transport capacity in the main line network of Bangladesh Railway increased

Progress Toward Outcome

Number of daily passenger trains 352 against target of 299.

Number of annual passengers 90.1 million against target of 72.6 million.

Implementation Progress

Description of Project Outputs

1. New rolling stock procured and commissioned

2. New equipment procured and commissioned

Status of Implementation Progress (Outputs, Activities, and Issues)
All the rolling stocks have been received by Bangladesh Railway.
Geographical Location
Nation-wide

Safeguard Categories

Environment
C
Involuntary Resettlement
C
Indigenous Peoples
C

Summary of Environmental and Social Aspects

Environmental Aspects
The project is limited to the procurement of rolling stock and equipment that will operate on existing railway lines. According to ADBs Safeguard Policy Statement (2009), the project is classified as category C for environment. The review of environmental impacts indicates that there will be no adverse environmental impacts during project implementation. During project operation, there will be a net environmental benefit through reductions in carbon dioxide emission due to a modal shift of passengers from road to rail, and the use of more efficient locomotives. Recommendations for proper solid and liquid waste management during project operations have been provided.
Involuntary Resettlement
In accordance with ADBs Safeguard Policy Statement (2009), the project is classified as category C for involuntary resettlement. The project involves the procurement of rolling stock and as such does not lead to resettlement impacts.
Indigenous Peoples
In accordance with ADBs Safeguard Policy Statement (2009), the project is classified as category C for indigenous peoples. The project involves the procurement of rolling stock and as such will not lead to adverse social impacts on indigenous peoples.

Stakeholder Communication, Participation, and Consultation

During Project Design
Consultations undertaken during the preparation of projects that were subsequently approved show that people have a positive attitude towards the improvement of the railway services, and viewed rail transport as a key factor in improving opportunities for business development and access to basic services, such as education, health care and administrative services. Moreover, they viewed the project as an important factor in facilitating tourism activities.
During Project Implementation
The loan agreement has been signed on 28 September 2016. After fulfilling all conditions for declaration of effectiveness, the loan has been declared effective on 26 October 2016.The procurement for all 6 packages have been completed and all contracts have been awarded.

Business Opportunities

Consulting Services
N/A
Procurement
All contracts for procurement of goods and services will be procured through international competitive bidding procedures. ADB standard bidding documents with post qualification under the single-stage, two-envelope system will be adopted.

Contact

Responsible ADB Officer
Das, Amrita Kumar
Responsible ADB Department
South Asia Department
Responsible ADB Division
Bangladesh Resident Mission (BRM)
Executing Agencies
Bangladesh Railway

Timetable

Concept Clearance
03 Jun 2015
Fact Finding
25 May 2015 to 05 Jun 2015
MRM
01 Jul 2015
Approval
30 Sep 2015
Last Review Mission
-
Last PDS Update
27 Sep 2021

Funding

Loan 3301-BAN

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
30 Sep 2015 28 Sep 2016 26 Oct 2016 30 Jun 2021 - 25 Aug 2022
Financing Plan
  Total (Amount in US$ million)
Project Cost 294.00
ADB 200.00
Counterpart 94.00
Cofinancing 0.00
Loan Utilization
  Date ADB Others Net Percentage
Cumulative Contract Awards 07 Dec 2023 169.71 0.00 100%
Cumulative Disbursements 07 Dec 2023 169.71 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory Satisfactory - Satisfactory - Satisfactory

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Title Document Type Document Date
Railway Rolling Stock Project: Completion Report Project/Program Completion Reports Nov 2023
Railway Rolling Stock Project: Audited Project Financial Statements (July 2021-June 2022) Audited Project Financial Statements Dec 2022
Railway Rolling Stock Project: Audited Project Financial Statements (July 2020-June 2021) Audited Project Financial Statements Dec 2021
Railway Rolling Stock Project: Audited Project Financial Statements (July 2019-June 2020) Audited Project Financial Statements Dec 2020
Railway Rolling Stock Project: Audited Project Financial Statements (July 2018-June 2019) Audited Project Financial Statements Dec 2019
Railway Rolling Stock Project: Audited Project Financial Statements (July 2016-June 2017) Audited Project Financial Statements Feb 2019
Railway Rolling Stock Project: Audited Project Financial Statements (July 2017-June 2018) Audited Project Financial Statements Feb 2019
Loan Agreement (Ordinary Operations) for Loan 3301-BAN: Railway Rolling Stock Project Loan Agreement (Ordinary Resources) Sep 2016
Railway Rolling Stock Project: Project Administration Manual Project/Program Administration Manual Sep 2015
Railway Rolling Stock Project: Report and Recommendation of the President Reports and Recommendations of the President Sep 2015
Railway Rolling Stock Project: Procurement Plan Procurement Plans Jun 2015
রেল উপকরণ ও গাড়ী প্রকল্প : প্রকল্প তথ্যপত্র Translated PDS Jun 2015
Railway Rolling Stock Project: Initial Poverty and Social Analysis Initial Poverty and Social Analysis May 2015

Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.


Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

Tender Title Type Status Posting Date Deadline
BAN: Railway Rolling Stock Project Advance Notice Archived

Contracts Awarded

Contract Title Approval Number Contract Date Contractor | Address Executing Agency Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
PACKAGE 3:PROCUREMENT OF 10 MG DIESEL-ELECTRIC LOCOMOTIVES Loan 3301 31 May 2018 HYUNDAI ROTEM COMPANY, KOREA | 37, CHEOLDOBANGMULGWAN-PO, UIWANG-SI, CYEONGGI-DO, REPUBLIC OF KOREA KOREA, REPUBLIC OF Bangladesh Railway 37,963,400.00 37,963,400.00
PACKAGE 5: PROCUREMENT OF 1 METER GAUGE AND 1 BROAD GAUGE AUTOMATIC TRAIN WASHING PLANT FOR BANGLADESH RAILWAY Loan 3301 07 Nov 2017 NS CORPORATION, USA | 235 W. FLORENCE AVENUE, INGLEWOOD, CALIFORNIA, 90301, USA UNITED STATES Bangladesh Railway 4,006,759.00 4,006,759.00
PACKAGE 6: PROCUREMENT OF 1 TRAIN SIMULATOR FOR LOCOMASTER TRAINING Loan 3301 11 Oct 2017 LANDER SIMULATION & TRAINING SOLUTIONS S.A. | PORTUETXE 23A, LOCAL B3, 20018 SAN SEBASTIAN (GIPUZKOA), SPAIN SPAIN Bangladesh Railway 2,161,780.00 2,142,263.00
PACKAGE 1: PROCUREMENT OF 200 METER GAUGE STAINLESS STEEL PASSENGER CARRIAGES Loan 3301 21 Sep 2017 P.T. INDUSTRI KERETA API (PERSERO) | J1, YOS SUDARSO NO. 71 MADIUN, 63122 EAST JAVA, INDONESIA INDONESIA Bangladesh Railway 73,901,756.00 73,901,756.00
Package 4: Procurement of 4 Relief Cranes (2 for Meter Gauge and 2 for Broad Gauge) Loan 3301 22 Jun 2017 M/S Kirow Ardelt GMBH | Spinnereistrasse 13, 04179 Leipzig, Germany Bangladesh Railway 19,268,100.00 19,268,100.00
Package 2: Procurement of 50 Broad Gauge (BG) Passenger Carriages Loan 3301 26 Jun 2017 M/S P.T. Industri Kereta Api (Persero) | Jin, Yos Sudarso No. 71 Madiun, 63122 East Java, Indonesia Bangladesh Railway 26,997,021.00 26,997,021.00

Procurement Plan

Title Document Type Document Date
Railway Rolling Stock Project: Procurement Plan Procurement Plans Jun 2015