Proposal to hike Payra project cost by 250pc

Dhaka,  Thu,  24 August 2017
Published : 20 Jun 2017, 00:24:22 | Updated : 20 Jun 2017, 10:05:03

Proposal to hike Payra project cost by 250pc

FE Report
Within less than two years, the Payra Port Authority has proposed to raise its project cost abnormally by 250 per cent due mainly to inclusion of foreign consultants and increased land prices, officials said Monday.

If approved the cost of the Payra port development project will be enhanced to Tk 39.48 billion from its preliminary estimate of Tk 11.28 billion.

"The port authority has sought revision of the project increasing the cost by 250 per cent. It has also appealed for extending the execution timeline by one more year up to June 2019," said a Shipping Ministry official.

He said the Executive Committee of the National Economic Council (ECNEC) had endorsed the 'Infrastructure and other facility development for operating Payra Port activities' at Tk 11.28 billion in September 2015.

The Payra Port Authority spent Tk 3.94 billion in last one and half years on the project.

In a bid to establish a full-fledged port at Payra in the coastal district of Patuakhali, the government approved the development project proposal (DPP) to make the under-construction port operational.

The authority will mainly construct port administrative buildings, a 5.60 kilometre 4-lane port-connecting road, and conduct dredging of the port channel up to the Bay of Bengal under the project.

A senior Ministry of Shipping (MoS) official said the port authority has sought Tk 5.00 billion for foreign consultants and Tk 16.00 million for local consultants in the revised development project proposal (DPP) instead of the original estimation of Tk 20 million fund for local consultants only.

Besides, the port authority has raised the 6,069.19 acre land acquisition cost abnormally to Tk 11.30 billion in the revised DPP. In the initial estimate the cost was estimated at Tk 2.84 billion.

The port authority has also sought double amount of money for purchasing two tug boats instead of its estimated price for one boat in the original project proposal, a senior official said.

The authority has also hiked the cost of constructing the 5.6 km 4-lane port-connecting road by 33 per cent to Tk 3.40 billion from its original estimate of Tk 2.55 billion in the original DPP.

A Planning Commission (PC) official said they are scrutinising the revised cost of the Payra Port development project as it has gone up manifold in the revised DPP.

"Immediately after the beginning of the project work, swelling of the project cost by 250 per cent is not justified. We are scrutinising the revised DPP seriously," he added.

The cost might have been enhanced as the project was undertaken without a proper feasibility study, the PC official added.Payra will be the third seaport of Bangladesh. The government has decided to build the port for easing pressure on Bangladesh's major port of Chittagong.

Chittagong seaport handles more than 70 per cent of the total foreign trades of Bangladesh every year.
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