20 Aug 2019
BRI Delivers on 20-Year-Old UN Bangladesh Rail Upgrade Blueprint
China backing sees work set to begin on long-delayed, United Nations-endorsed Chittagong-Cox's Bazar rail link.
It was officially confirmed late last month that work is set to begin on one of Bangladesh's key Belt and Road Initiative (BRI) infrastructure projects – a 102km rail link connecting Cox's Bazar, one of the country's leading tourist destinations, with Chattogram (formerly Chittagong), its principal port. The news came in a statement from the China Civil Engineering Construction Corporation (CCECC), the lead developer of the South Asia Subregional Economic Cooperation (SASEC) Chittagong-Cox's Bazar Railway Project, as it is formally known.
Spelling out the specific state of play, the statement read: "All the investment required for this project is now in place, with work due to commence in line with the agreed schedule. In order to facilitate this, a series of training seminars have also now been completed with designated project officials."
Once completed, the project will comprise a new dual-gauge line, along with 185 major and minor bridges, between Cox's Bazar and Chattogram, which is set some 242km southeast of Dhaka, the country's capital. The new line is scheduled to open in late 2023 and should be conveying some 2.9 million passengers annually by the following year.
BRI funding for the scheme was initially approved in September 2017, when officials from Bangladesh Railways, CCECC, MAX JV (a joint venture between CCECC and MAX International, a Dhaka-based multiservice conglomerate), and a China Railway Group-Toma Construction joint-venture vehicle, all agreed terms. The financing arrangements were finalised in May, when the Asian Development Bank (ADB) – one of the primary funding bodies behind the BRI – issued a loan of US$400 million to the Bangladesh government, the second tranche of the $1.5 billion the institution had already signed up to provide. All told, the loan will cover about 27% of the envisaged costs and is repayable over 25 years.
The line has added significance in that it is an integral part of the southern corridor of the Trans-Asia Railway Network, a project intended to offer a series of seamless rail links between Asia and Europe. While originally conceived by the United Nations (UN) in 1999, it has subsequently been co-opted as part of the wider BRI programme.
Exactly as envisioned by the UN, the new China-backed take on the scheme will see the southern corridor of the Trans-Asian Railway provide a continuous rail connection between Southeast Asia and Europe, as well as between Southwestern China and Europe. In addition, it will provide rapid rail transit between many of the outlying regions of the countries along its routes and their principal seaports.
As well as delivering on the proposed network, China has also taken on board a number of other UN Bangladesh-related initiatives. The China Railway Major Bridge Engineering Group, for instance, is now the primary construction firm behind the $3 billion Padma Multipurpose Bridge project, a UN-endorsed scheme designed to boost Dhaka's rail and road connectivity.
In other developments, earlier this year, the Bangladesh government announced plans to invest some $1.9 billion in upgrading the Akhaura-Sylhet single-gauge rail line to a dual-gauge connection – a 239km section of line that runs from Dhaka to Chattogram along various bridges and supporting infrastructure that will also require substantial upgrades. Under the terms of a Memorandum of Understanding signed in September 2015, the China Railway Construction Bridge Engineering Bureau Group is expected be the lead developer.
About $1.26 billion of the overall cost is also expected to be underwritten by China, with the remainder being provided by the Bangladesh government. In January 2017, the Chinese Embassy in Dhaka confirmed to Bangladesh's Economic Relations Division that China Exim Bank would provide up to $1.75 billion in credit support for the project.
Geoff de Freitas, Special Correspondent, Dhaka