The cost of the 17.20 km metro rail MRT-5 (Gabtoli-Dasherkandi) Southern Route project saw a sharp 15 percent reduction in cost following a recent review, indicating the potential of savings that can be achieved through reassessments of mega projects, initiated by the previous government, reports The Business Standard.
The cost cut, equivalent to Tk6,898 crore, came after Dhaka Mass Transit Company Limited (DMTCL) re-evaluated the project on instructions from the Planning Commission, now led by interim government's Adviser Prof Wahiduddin Mahmud.
Mohammad Abdur Rouf, managing director of DMTCL, told the media that the costs of various project components were reduced through detailed design adjustments.
The revised project proposal has been submitted to the Road Transport and Highways Division for further review which could result in additional cost cuts, he said.
Project Director Md Abdul Wohab said that the cost was cut by shortening the loan interest repayment period, cutting capital expenditures, and reducing inflated contingency estimates.
According to DMTCL officials, costs may be cut further following scrutiny by the Road Transport Division and finally by the Physical Infrastructure Division of the Planning Commission.
Initially, during the Awami League era, DMTCL had proposed a budget of Tk54,619 crore for the project. An evaluation committee at the Planning Commission reviewed the proposal in April this year but no cost adjustments were made at that time.
After the AL government was toppled, the interim government, led by Dr Yunus, decided to reassess spending on major infrastructure projects. This project was sent back to DMTCL for review leading to a revised projected cost of Tk47,721 crore.
After the initial review, DMTCL submitted the revised Development Project Proposal (DPP) to the Road Transport and Highways Division.
In a letter to Road Transport, DMTCL said the estimated cost was cut based on an analysis of costs, unit rates, foreign loan interest, and feasibility reports, along with a re-examination of the project's context and priorities.
The DPP outlines that of the total cost, Tk39,138 crore will be covered by foreign loans. The Asian Development Bank (ADB) and South Korea have initially agreed to provide the amount.
The MRT-5 southern route will connect the following areas: Gabotli, Technical, Kalyanpur, Shyamoli, College Gate, Asad Gate, Russell Square, Karwan Bazar, Hatirjheel, Tejgaon, Aftabnagar, Nasirabad, and Dasherkandi.
The metro line will run 13.10 km underground from Gabtoli to Aftabnagar and 4.10 km elevated from Aftabnagar to Dasherkandi.
Bd-pratidin English/Tanvir Raihan
