Frustrating pace of foreign-funded projects

Published: June 06, 2018 21:36:55 | Updated: June 08, 2018 22:09:08


Representational image. Credit: Center for Policy Dialogue

Slow pace of project implementation, especially in case of foreign-funded ones, has almost become a norm in Bangladesh. This phenomenon has now become widespread in the absence of proper monitoring-cum-evaluation as well as robust mechanism for ensuring accountability. The standard practice followed worldwide is carrots for successes and sticks for failures. But in case of Bangladesh, both seem to be conspicuous by their absence. The latest instance in this arena, as reported by this paper on Tuesday last, shows the disbursement of funds from the first Indian Line of Credit (LoC) to be abysmally low. Made operational in 2010, only $389 million, out of the total LoC of $862 million, has been actually disbursed in these long eight years. As for the current fiscal year (up to May this year), the disbursement has been a paltry $38.5 million. Consequently, the people are being deprived of getting expeditiously the benefits from the related infrastructural-cum-social sector projects, initiated by the government of Bangladesh (GoB) with Indian assistance. The Prime Minister herself has expressed deep concern at the slow progress of LoC projects, which was relayed by her economic affairs adviser during a status review meeting held in PMO recently.

India has provided three consecutive lines of credits totalling over $8.0 billion to Bangladesh within a span of eight years. The first one was signed in 2010, the second, in 2016, and the third LoC, in 2017. Of them, the latter is by far the biggest with an outlay of $5.0 billion, including $500 million for defence purchases. The loans are to be paid back at only 1.0 per cent rate of interest in 20 years with a grace period of five years. But 65 to 75 per cent of the services, goods or works are to be procured from the Indian market under the agreements. These are also considered by some observers as part of an Indian strategy to win over Bangladesh in the regional power-play. Key sectors in Bangladesh like power, railways, roads, shipping and ports are to be benefited from these. But only $576 million, out of a total of $3.06 billion from the first two LoCs, could be spent by the government agencies in Bangladesh until 2017.  

As has been pointed out many times, the line ministries have a key role to play in the entire process of project formulation, documentation, processing, approval and execution. But it is frequently observed that the projects get bogged down at different stages due to lack of professionalism and proactive initiatives on their part. This bureaucratic inefficiency, red tape and lethargy must be dispensed with if any improvement is to be brought about in project implementation. Added to this is the selection of project personnel as well as the informal influences wielded by the administrative and political masters over them.

Against this backdrop, it is regrettable that a professional project management cadre could not yet be groomed in Bangladesh. In its absence, the aspirants often vie for such positions through lobbying in the corridors of power. The result is the posting of numerous administrative personnel in projects, who themselves are not adequately conversant with the theories and practices of project management. In addition, akin to informal economy, there exists an informal administration in Bangladesh that wields enormous influence in matters of governance. Despite some progresses in procurement rules and delegation of financial powers, the projects often get bogged down due to these twin factors. Given this situation, not much of any improvement can be expected in areas of project execution. The prime need here is to address the twin challenges, conclusively by the government in power, in order to change the situation about execution of foreign-funded projects. Unfortunately, the devil here continues to lie in the details.

Share if you like