More than one-third of the total cost of large infrastructure projects over the past 16 years has been lost to corruption and inefficiency, according to a new study.

“Billions of dollars have been effectively wasted due to inflated contracts, collusive pricing, and procedural weaknesses,” said Mushtaq Khan, professor of economics at SOAS University of London.

Khan unveiled the findings at a roundtable titled “Corruption in infrastructure projects in Bangladesh and Sri Lanka: Implications for public debt” held in Dhaka on Tuesday, organised by the research-based think tank Change Initiative.

The study reviewed 42 major infrastructure projects undertaken between 2009 and 2025 and found that around 35 percent of total project costs were lost to corruption and inefficiency.

The projects span 15 distinct subsectors, which the researchers grouped into six broad meta-sectors for comparative assessment: transport and connectivity; power and energy; maritime and ports; rail and metro systems; economic zones; and urban and utility infrastructure.

However, Khan did not cite the actual amount lost to corruption.

The study also reported that projects awarded through open international competitive bidding were found to be significantly cheaper.

In contrast, direct government-to-government deals consistently drove up costs by more than 400 percent compared to more transparent alternatives.

“When only politically connected firms participated in bidding, prices tended to be collusive and substantially higher. In such cases, formal transparency and accountability mechanisms had limited impact,” said Khan.

“In circumstances where a small circle of politically connected investors dominates the bidding process, businesses collude and there are no effective horizontal checks on bureaucrats and regulators,” he added.

“We have to attract new investors who are not politically connected, but they keep away because of the high political risks,” said Khan.

New investors entered the market, and contracted prices dropped by at least 25 percent because new actors ensured horizontal checks on procurement agencies, Khan noted.

At the event, Zakir Hossain Khan, chief executive officer of Change Initiative, urged the new government to revise or scrap the corruption-prone contractor agreements signed by the previous administration.