Financial Analysis of Padma Bridge

THE PADMA BRIDGE ISSUE The Padma Bridge Issue (A Dream or a Scandal) Submitted To: Mr. Md. Najmul Hasan Lecturer Department of Banking & Insurance University of Dhaka Submitted By: Group-11 NameI. DSignature MD. Jamal Hosen 16-056 MD. Shafiqul Islam 16-096 Masudur Rahman 16-094 M.

M. Azizur Rahman 16-079 Zual Rana16-079 Date of Submission: 16 October, 2012 16th October, 2012 Mr. MD. Najmul Hasan Lecturer Department of Banking University of Dhaka Subject: Report on “Padma Bridge Issue”. Sir, Here is the term paper on “Padma Bridge Issue” that you assigned us to prepare.In this term paper we have taken the information of Padma Bridge from primary & secondary sources. We have tried to show that whether the Padma Bridge is dream or scandal for our country.

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In this report we mainly focused on Padma Bridge scandal, alternative financing sources, economic value of Padma Bridge and so on. This term paper will provide you with information according to your direction. We have studied the relevant information for preparing this term paper.

We hope that this term paper will meet your requirement. We would be glad to furnish any further clarification in this regard, if needed.Sincerely yours, …………………………… On behalf of group-11 Department of Banking & Insurance University of Dhaka. First of all we are grateful to Almighty Allah for finishing this report on time. We express our thanks to our honorable course teacher Mr. MD. Najmul Hasan for assigning us such a report dealing with “Padma Bridge Issue”. Without cooperation and the support from our course teacher Mr.

MD. Najmul Hasan, it would not be possible to prepare such a resourceful report. We would like to thank you for your constant guidance and support that helped us most to complete this report.Pay our gratitude to all of the people who helped us a lot for the completion of this report before, during, and after the working period. Today Bridge is now the most talked matter in our country.

Padma Bridge issue is not a national issue, it is global issue now. We see that in some recent time Padma Bridge has been the alarming subject in our country. For this reason we have selected at this topic. We know that this Bridge is not only simply the Bridge of the people of this country but also the dream of the country people. When we think Padma Bridge have to think this thing like the reedom, like the democracy, like the emotion of the country people.

In this report we have tried to focus on the Padma Bridge whether it is dream or scandal. We have also shown the alternative sources of financing regarding this Padma Bridge. We tried to concentrate on the better financing that which one is better foreign or domestic. We have just given some events relating to this Padma Bridge scandal.

We have rectified the project management of this Bridge. Economic value of this Bridge also has been given to this report. At the end of this report we have shown some merits and demerits of this Bridge.

We have ended this report with nice conclusion and recommendation. SL. no. TitlePage no. 1.

Introduction 2. Overview of the Padma Bridge 3. Problems Regarding the Padma Bridge Issue 4. Some review of Padma Bridge Scandal 5. 6. 7. 8. 9.

10. 11. 12. 13.

Recommendation 13. Conclusion 13. References Introduction A bridge not only connects the people of the two sides of the river but also connects the dreams of the people to reality. It means, through the construction of a bridge the people can develop their existing socio-economic condition.Bangladesh, our motherland and The Padma is the main river of this country.

This river divides the districts of the south-west side of our country from the Dhaka city (The capital of Bangladesh) and from the north Bengal. The Padma Bridge is the name of the dream of the people of Bangladesh especially for those of the south-west region. If the Padma Bridge is constructed the total communication system will be developed moreover the dream of Gas and Railway of the people of south-west Bengal will come true. And consequently the socio-economic condition of the people of those regions will be developed.Objectives Broad Objectives: The Broad objective of preparing this report is to get an overall idea about the Padma bridge scandal and how this dream can be true. Specific Objectives: ?To have better orientation of information regarding this Padma Bridge scandal.

?To apply theoretical knowledge in the practical field. ?To be capable of knowing the main reason behind this Padma Bridge scandal. ?Showing the concern to the general people of this country. ?To identify and suggest scopes of taking right decision in the right time & place. Methodology Sources of data:There are two sources of data that will be used and most of the data will be collected from the secondary sources. The sources are- 1. Primary Sources: a. Talking with the people those who are connected with this issue.

b. Official records and observing practical work. 2. Secondary Sources: a. Many reports on this b. Newspaper.

c. Website. Overview of the Padma Bridge The Padma Bridge is a multipurpose road-rail bridge across the Padma River to be constructed in Bangladesh. Connecting Areas: This Bridge will connect Louhajong, Munshiganj to Shariatpur and Madaripur, linking the south-west of the country, to northern and eastern regions.The project covers three districts, Munshiganj (Mawa Point/North bank), Shariatpur and Madaripur (Janjira/South bank). Length and width: The two-level steel bridge will carry a four-lane highway on the upper level and a single track railway on a lower level. The project will include 6. 15 km long and 21.

10 m wide bridge, 15. 1 km of approach roads, toll plazas and service areas. Cost of Constructing the Padma Bridge: Project cost is estimated to be US $3. 00 billion. Financing of Padma Bridge: Funding for the project is provided by the Asian Development Bank (US$615 m), the World Bank (1.

billion), Japan International Cooperation Agency ($415 m), Islamic Development Bank ($140 m). and Abu Dhabi Development Group ($30 m). Of the total amount, the government will provide Tk 50 million while the rest will come in the form of project aid.The Cost of alternative sources of financing: The foreign financing options that have been in discussion including:- Soft-loan providers like the WB Asian Development Bank Japan International Cooperation Agency (JICA) Islamic Development Bank Suppliers’ credit from Malaysia Issuance of sovereign bonds by the government itself. Problems Regarding the Padma Bridge Issue inancing of the project would be dome from domestic resources. Now, the problem is that whether the plan sort out by the Prime Minister is sufficient to construct the proposed Padma Bridge without foreign funds or not. The Padma Bridge scandal On September 21, 2011 the WB sends a letter to the finance minister alleging that then the communications minister Syed Abul Hossain and high officials of SAHCO had pressed for the appointment of SAHCO as a “commission agent” regarding the selection of contractors’ pre-qualification for the main bridge’s construction. The lender also suspends financing.

After that The Royal Canadian Mounted Police (RCMP) launch an investigation against SNC-Lavalin following a WB request, raid the company’s office, seize all documents from there and arrest former chief executive Pierre Duhaime, Bangladeshi-born Canadian citizen Ismail Hossain and Indian-born Canadian citizen Ramesh and on December 5, 2012 Syed Abul Hossain removed from the communications ministry and given the charge of ICT ministry. According to RCMP, the SNC-Lavalin had offered at least six influential Bangladeshis huge bribes to obtain the consultant’s job in the Padma bridge project.They are — ?Abul Hossain ?Abul Hasan Chowdhury ?Mosharraf Hossain Bhuiyan, ex-secretary of the Bridges Division of the communications ministry ? Rafiqul Islam ex-director of Padma Multipurpose Bridge project ? Mujibur Rahman Chowdhury alias Nixon Chowdhury, civil contractor ? Ziaul Huq, managing director of Engineering and Planning Consultant Ltd (CEP), who represented SNC-Lavalin in the Padma bridge tender. But The ACC has said that its investigation found no tangible evidence of corruption in the project and that it did not find any proof of corruption against Abul Hossain.

ACC Secretary Faizur Rahman Chowdhury says the ACC had launched two separate investigations on the Padma bridge project. ?One is on the construction of the bridge ?The other on the appointment of a consultant firm He said, “In the first investigation; we did not find any proof in favor of the allegation. The second investigation is still on.

” Early of June 2012 in a letter to Sheikh Hasina, WB Vice President Isabel Guerrer gives the government “five conditions” to take to get WB funding for the massive project. The conditions are:On July 23, 2012, Syed Abul Hossain resigns as the ICT minister, two days after, he in an open letter to the countrymen hinted about the resignation for the interest of the country. As Syed Abul Hossain steps down as ICT minister, the resignation of an adviser to Prime Minister Sheikh Hasina remains vital for the revival of World Bank finance regarding the construction of the Padma Bridge, say officials. Finance minister AMA Muhith calls the JICA president and requests him to raise the Padma bridge issue with the World Bank during his visit with the WB chief on July 25, provided that the government took some steps on a vital WB condition.The Bank might review its loan cancellation if the government implements three conditions, including the removal of the two minister-level public officials allegedly involved in the project graft. The government has to fulfill the conditions within this month as the project co-financiers — Asian Development Bank and Japan International Cooperation Agency — have extended their loan effectiveness till August 30. Now, finance ministry sources say fresh talks got underway last week with the WB and based on the discussions Finance Minister AMA Muhith has drafted a letter seeking a reversal of the loan cancellation.

Some review of Padma Bridge Scandal Malaysian proposal on Padma Bridge in 3 weeks: The Daily Star online report August 5, 2012 Malaysia will submit a final proposal to Bangladesh regarding the construction of Padma bridge in three weeks. Communications Minister Obaidul Quader told reporters after a meeting with a six-member Malaysian delegation. World Bank did not provide corruption evidence, claims Hasina: Prime Minister Sheikh Hasina gives an interview to BBC World The Daily Star Online Report July 30, 2012 Prime Minister Sheikh Hasina has claimed that though the World Bank raised corruption allegations against the Padma bridge project.World Bank not happy with resignation of ‘patriot’ Syed Abul Hossain: The Daily Star July 28, 2012 The World Bank is still not satisfied with Bangladesh’s recent anti-corruption move over the Padma bridge issue despite resignation of a key minister.

Civil society, politicians welcome Syed Abul’s resignation: The Daily Star July 24, 2012 Welcoming the resignation of Syed Abul Hossain as a minister, a number of political leaders and eminent personalities have said though it is a belated decision, his departure would pave the way for reviving. Syed Abul Hossain finally resigns:Syed Abul Hossain The Daily Star Online Report July 23, 2012 Syed Abul Hossain resigned as Information and Communication Technology (ICT) Minister on Monday. He was made the head of the ICT ministry on December 5 last year. Bangladesh may make World Bank letters on Padma bridge corruption public: Inam Ahmed The Daily Star July 15, 2012 The World Bank (WB) has said the government may disclose the Bank’s reports containing “evidence of corruption” in the Padma Bridge project for the sake of transparency and public interest.

China shows the way to curb corruption:Syed Ashfaqul Haque, Chief News Editor, back from China The Daily Star July 11, 2012 Bangladesh can learn a lot from China about tackling corruption and the role a clean government can play in executing a billion dollar-plus project. Current situation of Padma Bridge The World Bank’s international specialized team recently has come in Bangladesh to investigate the corruption. The director of this team is ex-chief lawyer of I. C. C. Mr. lui Gabriel morena okampo, another two members are Timothy Tong from HONGKONG, Richard Olderman from U.

K.Already we known that WB has given the statement that they have the willingness to finance for the Padma Bridge. Last day the World Bank’s international specialized team raised a question that whether Bangladesh has the law of conspiracy of corruption. Bangladeshi DUDUK has answered the question. Basically WB has accused against Padma Bridge issue for the conspiracy of corruption.

DUDOK has said that if anything happened like conspiracy of corruption then it will be judged by the law of Bangladesh. Conclusion Finally it can be said that the Padma Bridge issue is a very sensitive issue for our country.Top level of the government should approach carefully and wisely in course of solving the problems arises regarding this issue. Decisions or comments about this issue should not be based on the emotions or other things rather they should be in the way that will helpful in making the project pragmatic. On the other hand the WB should think about the Padma Bridge project because it is a massive project after all. References The Daily Star BBC World bdnews24.

com Prothomalo Financial express 2011 www. google. com www. facebook.



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