fbpx 53260-001: South Asia Subregional Economic Cooperation Integrated Trade Facilitation Sector Development Program | Asian Development Bank

Bangladesh: South Asia Subregional Economic Cooperation Integrated Trade Facilitation Sector Development Program

Sovereign (Public) Project | 53260-001 Status: Proposed

The proposed South Asia Subregional Economic Cooperation (SASEC) Integrated Trade Facilitation Program (the Program) will help improve Bangladesh's border infrastructure and trade facilitation environment, thereby contributing to the national goals of promoting and diversifying exports. The Program will support Bangladesh's implementation of the World Trade Organization's (WTO's) Trade Facilitation Agreement (TFA), a set of new, binding international standards, and related best practices on transport and trade facilitation. The Program will also support for the Government of Bangladesh to establish and improve border infrastructure, which will reduce the cost and time of cross-border transactions. This aligns with the government's ongoing customs reform and modernization initiatives, the SASEC Operational Plan 2016-2025, and one of the country partnership strategy's (CPS) priority areas, deepening regional cooperation and integration.

Project Details

Project Officer
Nakane, Masato South Asia Department Request for information
Country
  • Bangladesh
Sector
  • Industry and trade
 
Project Name South Asia Subregional Economic Cooperation Integrated Trade Facilitation Sector Development Program
Project Number 53260-001
Country Bangladesh
Project Status Proposed
Project Type / Modality of Assistance Loan
Technical Assistance
Source of Funding / Amount
Loan: South Asia Subregional Economic Cooperation Integrated Trade Facilitation Sector Development Program
Ordinary capital resources US$ 100.00 million
Loan: South Asia Subregional Economic Cooperation Integrated Trade Facilitation Program
concessional ordinary capital resources lending / Asian Development Fund US$ 50.00 million
TA: South Asia Subregional Economic Cooperation Integrated Trade Facilitation Program
Technical Assistance Special Fund US$ 1.00 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Knowledge solutions
Private sector development
Sector / Subsector

Industry and trade / Industry and trade sector development

Gender Equity and Mainstreaming Some gender elements
Description

The proposed South Asia Subregional Economic Cooperation (SASEC) Integrated Trade Facilitation Program (the Program) will help improve Bangladesh's border infrastructure and trade facilitation environment, thereby contributing to the national goals of promoting and diversifying exports. The Program will support Bangladesh's implementation of the World Trade Organization's (WTO's) Trade Facilitation Agreement (TFA), a set of new, binding international standards, and related best practices on transport and trade facilitation. The Program will also support for the Government of Bangladesh to establish and improve border infrastructure, which will reduce the cost and time of cross-border transactions. This aligns with the government's ongoing customs reform and modernization initiatives, the SASEC Operational Plan 2016-2025, and one of the country partnership strategy's (CPS) priority areas, deepening regional cooperation and integration.

The proposed Program will help speed up clearances, improve compliance, focus essential resources on cargo carrying higher risk, strengthen infrastructure, and lead to better administration of customs laws and regulations (by initial introduction or by supporting more effective and deeper implementation). The key measures in this regard could include (i) pre-arrival and paperless processing; (ii) strengthened risk management; (iii) post-clearance audit; (iv) authorized economic operator (AEO)/trusted trader programs; (v) establishment of national single window; (vi) expedited shipments; (vii) improvements in inland clearance system, transit and transshipments; (viii) temporary importation systems; (ix) expanding the scope of advance rulings; and (x) equipping customs laboratories. These measures provide opportunities to enhance trade facilitation sector efficiency and performance, consistent with the objective of the government.

Project Rationale and Linkage to Country/Regional Strategy

The Doing Business Survey by the World Bank shows significant inefficiencies in border operations in Bangladesh, ranked as 176 out of 190 countries. Specifically, there is excessive physical examinations of cargo, (almost 100%), manual input of documents, including duplication of documents previously submitted, even though a customs information technology (IT) system exists and little use of pre-lodgement and assessment of customs declaration and associated documents before the cargo arrives at the border post. This indicates an absence of the implementation of World Customs Organization (WCO) and WTO international standards relating to risk assessment of cargo, and the use of the WCO data model to improve efficiency of customs procedures.

Modernization of customs and trade facilitation are essential in the current competitive trade environment, but the country is behind other South Asian countries. In the World Bank's logistics performance index (LPI), weakness is apparent in many areas of the global performance of Bangladesh. Its overall LPI score in 2018 was 2.58 out of 5. Its country rating is 100, as compared to 160 countries. For the same reasons previously mentioned, specifically the lack of the use of risk management principles, the need to submit manual documents for every shipment, the lack of use of pre-lodgement of information, adequate personnel and effective IT facilities, Bangladesh showed weakness in 4 out of 5categories of logistics performance index (LPI); namely, customs, infrastructure, international shipments, quality logistics services and tracking and tracing. It showed average score in one category, timeliness. Customs, for example scored 2.3 out of 5 and ranked overall 121 out of 160 in the 2018 LPI study.

Thus, there is need to implement the next phase of customs modernization reforms, as part of the wider trade facilitation agenda to improve the efficiency of trade, promote exports, support the implementation of the WTO TFA and make the reforms sustainable through capacity building and institutional strengthening. The impact of the reforms already initiated can be made more beneficial by promoting better on-the-ground implementation.

Impact Region's trade and commerce expanded
Outcome Faster, cheaper, more predictable and more secure cross-border trade in Bangladesh achieved.
Outputs

Customs legal framework improved and aligned with international standards.

Cargo clearance processes made efficient, predictable, transparent, and automated

Institutional capacity strengthened

Trade and transport infrastructure improved

Geographical Location Nation-wide
Safeguard Categories
Environment B
Involuntary Resettlement B
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services ADB will engage an international consulting firm following ADB Procurement Policy (2017, as amended from time to time) and its associated project administration instructions and/or staff instructions. The consulting services will be implemented in 5 months by a team of international and national experts.
Procurement Procurement required for the investment part of the sector development program is small works to build custom building and facilities and improve pavement of short road sections. Procurement risk is low. However, the National Board of Revenue will require additional procurement support from procurement specialists of Resident Mission. BLPA and RHD are considered to have adequate resources and institutional capacity to deal with such low risk and simple procurement.
Responsible ADB Officer Nakane, Masato
Responsible ADB Department South Asia Department
Responsible ADB Division Regional Cooperation and Operations Coordination Div, SARD
Executing Agencies
Bangladesh Land Port Authority
Bangladesh Sthala Bandar Kartripaksha TCB Building, 1 Karwan Bazar
Bangladesh Railway
16 Abdul Gani Road
Bangladesh Railway, Rail Bhaban,
Dhaka, Bangladesh
Local Government Engineering Department
LGED Bhaban (Level 6), Agargaon
Sher-e-Bangla Nagar,
Dhaka 1207, Bangladesh
Ministry of Finance
Economic Relations Division (ERD), MOF
Sher-e-Bangla Nagar, Dhaka_1207
Bangladesh
Ministry of Road Transport and Bridges
The Roads and Highways Department
Dhaka, Bangladesh
Ministry of Shipping
Bldg #6, Bangladesh Secretariat
Dhaka 1000, Bangladesh
National Board of Revenue
Rajashwa Bhaban Segunbagicha, Dhaka 1000
Bangladesh
Roads and Highways Department
Sarak Bhaban
Tejgaon, Dhaka-1208
Bangladesh
Timetable
Concept Clearance 28 Nov 2019
Fact Finding 02 Aug 2020 to 06 Aug 2020
MRM 24 Sep 2020
Approval -
Last Review Mission -
Last PDS Update 02 Dec 2019

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.

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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

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Related Publications

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Tenders

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Contracts Awarded

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Procurement Plan

None currently available.