A MODERN metro system inb Dhaka can offer immense public benefit, but the inflating cost trajectory, as per the contractors’ proposal, of the forthcoming lines raises serious concern. The reported escalation of MRT Line 1 cost from about Tk 52,500 crore to about Tk 96,500 crore and of the northern route of MRT Line 5 cost from Tk 41,200 crore to about Tk 88,000 crore can hardly be considered routine adjustments. Dhaka Mass Transit Company Ltd officials have acknowledged that additional engineering conditions attached to financing by the Japan International Cooperation Agency have narrowed contractor competition, leaving the government in a tight spot. Such donor-driven specifications are likely to place external preferences over national value-for-money considerations. When Bangladesh is navigating macroeconomic strains, doubling project costs signals weak bargaining capacity. The metro network remains essential for Dhaka’s mobility and environmental future, yet necessity cannot justify opaque procurement structures or escalating bills that outpace both original projections and the fiscal comfort zone. Without a swift scrutiny, these overruns could set a troubling precedent for large projects, normalising excess rather than efficiency. Such cost overruns also raise a deep structural concern about tender conditions in projects financed with external debt.
Loans tied to specific prescriptions or technical standards can effectively create a syndicated marketplace dominated by firms from the lending country. This appears to have happened in this case. The consequences will be burdensome. The outcome will not merely be higher construction costs but a long-term repayment burden in foreign currency, exposing the economy to exchange-rate volatility and fiscal stress. Given the already critical external debt position, the projects could place immense pressure on the economy and citizens. Moreover, heavy spending on lines that will run through areas not yet fully inhabited may force the government into sustained subsidies. Projects intended to ease urban life could, in effect, tighten the economic constraints faced by the citizens that they aim to serve. Prudent supervision demands rigorous and thorough cost-benefit reassessment before commitments become obligations that future taxpayers must honour regardless of project performances. Silence about the risks would be fiscally irresponsible. Fiscal prudence is not anti-development. It is the foundation of sustainable development. By insisting on open tenders, realistic costing and accountable negotiations, the state can deliver a system without unduly straining the economy.
The government must, therefore, reassess and renegotiate where necessary. Transparent, international competitive bidding is essential to restore price discipline and public confidence. A fresh review of route priorities and engineering specifications could trim excess costs. Policymakers should remember that every borrowed dollar is ultimately repaid by citizens.
