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Asia

Bangladesh bridge project mired in corruption allegations

It is hoped that the planned Padma Bridge project in Bangladesh will change the lives of some 30 million people. However, the project to modernize transport links has been plagued by allegations of corruption.

In South Asia, there is great interest in restoring and modernizing the international transport arteries of the region. Even arch enemies and nuclear rivals India and Pakistan are making an effort to relax cross border passenger and freight transport.

India also wants to further involve its northeastern regions in the overall development of the region. It is also looking to greatly build up its trade links with South East Asia, in its own South Asia version of "Ostpolitik." However, this plan also requires greatly increased investment in transport projects.

Bangladesh, as a potential transit nation into the ASEAN trade area also wants to profit and claim its share of the prosperity from these developments. A transit agreement with India is already prepared, although this because of some recent problems on both sides, is has not so far been possible to implement this.

Costliest transport project in nation's history

Indeed, Bangladesh's infrastructure project – in particular the plans for one bridge - has generated a real stir.

Sheikh Hasina

Hasina's government has been keen to blame the former administration

Two of South Asia's mightiest rivers, the Ganges and the Brahmaputra flow through Bangladesh and meet before draining into the sea. At the confluence of the rivers is the region of Padma. Currently, traffic has to be diverted a long way around the area as there is still no bridge.

During the term of office of the last government there were already plans for a 6-kilometer (3.8-mile) bridge for both road and rail links. The World Bank was supposed to help finance the 3-billion-US dollar (2.3-billion-euro) project and make a 1.2-billion-US dollar credit facility available.

At the beginning of 2011, the ground was prepared, and the work was to begin without delay. The specified goal was both to improve the lives of some 30 million people in the southwest of the country through the improved transport links and, in doing so, to stimulate economic growth across the country as a whole. Never before had the World Bank promised such a large amount of money to a project in Bangladesh.

Contradictory signals from World Bank

Then the financing faltered. The World Bank raised serious allegations of corruption against a Canadian firm and high-ranking members of the government, pulling the plug on its participation at the end of June this year. This put Prime Minister Sheikh Hasina increasingly under pressure - although she has tried to place responsibility for the irregularities squarely at the door of the last regime. The completion of the bridge is one of the top election pledges of the government.

Other potential financiers, such as the Asian Development Bank, the Japanese Agency for International Cooperation and the government of Malaysia might  the gap in funding and drive the project forward.

However, the World Bank has also signaled that it could help to finance the bridge, but only if the government of Bangladesh does more to fight corruption. It wants certain officials that it considers have been implicated with the corruption to be immediately relieved of their duties.

Secret agents of the World Bank?

Former Communications Minister Syed Abul Hossain has already left his post, while economic advisor Mashiur Rahman is expected to follow. According to some media reports, he is already on leave. However, Rahman himself will have none of it. Instead, he has himself leveled strong allegations against the World Bank, saying that it maintains "a network of secret agents in Bangladesh" and of trying to cover up its own mistakes in the project. 

Indeed, there are allegations within Bangladesh that the World Bank withdrew from the project at the influence of the US government, because the Bangladeshi government had sacked Nobel Prize winner Muhammad Yunus from the post of chief executive of a microcredit bank that he himself founded.

Nobel Peace Prize winner Muhammad Yunus speaks during a business forum in Athens

There are rumors that the US leant on the World Bank to withdraw after Yunus was removed

The renowned economic advisor Imtiaz Ahmed believes there is little chance now of the project getting underway during the current political term. "Some dismissals and resignations have indeed taken place, but the role played by economic advisor Mashiur Rahman remains unclear," said Ahmed. "Time is short. Even in the event of a positive decision (by the bank), it is very unlikely that the current government be able to manage it. I think we will have to wait at least until the next election."

Scope for corruption

While Europe and the US suffer from the financial and economic crisis, the economies of Asia are flourishing. Giant infrastructure projects have altered the fates of many regions, creating jobs and helping the economy to grow. But while China is able to build new dams, roads bridges and rail networks at incredible speed, improvements to local infrastructure are rather more difficult in countries like India.

Democratic nations have less freedom when it comes to making decisions and carrying them out. Citizens have legal instruments at their disposal to delay and even prevent large projects from going ahead. And, the complex decision project also creates many possibilities for corruption – something that can begin as early as the stage of awarding contracts.

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