Tuesday, February 28, 2012

Govt To Pay Over Tk.1.7 Billion Extra For Indian Locomotives

Bangladesh Railway (BR) will procure 16 locomotives from India at a cost of Tk.3.66 billion under a railway development project against a credit facility of billion from India. The government was supposed to purchase 30 locomotives with the same amount.

Lack of coordination and imposing strict terms and conditions by the Indian government has forced Bangladesh Railway to spend the additional fund to procure the locomotives, a high official of BR said.

The Indian government will supply the locomotives through a credit of billion of Exim Bank of India.

The time consuming procedures and some strict conditions from the Indian side were the main reasons behind the extra expenditure, an additional secretary of Bangladesh Railway said seeking anonymity.

As a condition of funding the project, the Indian government has imposed a condition that made the Indian companies the lone eligible parties for participating in the tender for supplying the locomotives.

As a consequence of the condition, Indian firm Expotech Division was the lone participant of the tender.

In a proposal, submitted to the government purchase committee recently, Bangladesh Railway mentioned that it has decided to purchase 16 locomotives instead of 30 as the project cost had increased by 88.21 percent due to high price of steel materials and copper.

Bangladesh Railway is likely to place another proposal to the purchase committee for awarding Expotech Division of India the contract to supply the locomotives, officials said.

Earlier, the project was approved by the Executive Committee of the National Economic Council (ECNEC) on January 4 last year. The timeline for the implementation of the project was set from December 2010 to June 2013.