Bangladesh requests World Bank to revive Padma Bridge fund

The Daily Star July 26, 2012

The government yesterday sent a letter to the World Bank headquarters requesting the global lender to reconsider its cancellation of the Padma bridge loan.

The government move comes following the resignation of Syed Abul Hossain, who was allegedly involved in corruption in the Padma bridge project.

The Economic Relations Division (ERD) also sent letters yesterday to the two other co-financiers, ADB and Jica, requesting them to continue funding for the project, said an ERD official on condition of anonymity.

The ERD informed the lending agencies about the government’s steps taken so far to fulfil the WB’s conditions for releasing the bridge fund, said the official.

Meanwhile, to comply with the WB’s other condition, the Anti-Corruption Commission agreed to the WB proposal for forming a three-member panel to ensure a transparent and fair probe into the corruption allegations in the Padma bridge project.

Talking to journalists at his office, ACC Chairman Ghulam Rahman said apart from forming the panel, the government was also willing to sign a memorandum of understanding with the WB.

The WB on June 29 cancelled its $1.2 billion project funding that it had kept suspended since last September on allegations that ex-communications minister Abul Hossain and some public officials were involved in corruption in selecting the Canadian company SNC-Lavalin for the bridge’s supervisory work.

The global lender called for certain government actions, including the removal of Abul and some officials, and also signing of a MoU with the ACC. But the government was reluctant to meet the two conditions.

Following the WB’s loan cancellation, the government announced that it would implement the project with it own resources. However, the government gradually changed its position in the last few days and took steps to win back the WB’s confidence and fulfil its conditions.

Muhith’s statement

In a written statement, Finance Minister AMA Muhith yesterday held out the assurance that there would be no corruption in the Padma bridge project.

“We want to assure you that there will not be any corruption in the Padma bridge project.” And the bridge’s initial work will start within this year, said Muhith.

He said the work was hampered when the WB raised corruption allegations in the project.

Following the WB’s allegations, the ACC initiated a probe into the allegations in August 2011 but did not find any corruption in the project. The ACC continued its probe as the WB reaffirmed its allegations, the minister said.

“Right from the moment the WB cancelled the loan, we have been saying that the decision needs to be reconsidered. We are still hopeful that the WB will reconsider its decision and clear us of the humiliation.”

Bangladesh had been lobbying with the other three development partners long before the global lender cancelled its loan agreement, he said.

Of the three development partners, the Islamic Development Bank said it was eagerly waiting to fund the project, and also urged the government to remove all barriers to the bridge’s construction as soon as possible, Muhith said.

Jica is keeping constant contact with the government, and the ADB is also in discussions with the government, he said.

The government has already fulfilled two conditions set by the global lender on June 5.

ACC chief’s briefing

The ACC chairman yesterday told the press, “The World Bank had proposed forming a three-member panel with experts in international probe and prosecution to help the ACC in its investigation into the corruption allegations in the project.”

The ACC finally agreed to this proposal, albeit after a month’s delay.

“The area of cooperation between the ACC and the World Bank will include continuous sharing of information during the enquiry, investigation and prosecution phases if the probe establishes a prima facie case,” Rahman said.

The ACC had not agreed to the proposal earlier, saying the law did not permit an agreement with such a panel.

But the ACC chief yesterday said that through analysing the relevant laws, the ACC had found five areas where it could cooperate with the WB and fulfil the condition.

Rahman said the ACC would give the panel full access to all files, materials, documents and other information gathered by the ACC’s enquiry team.

It will also provide the background information and credentials of the members conducting the enquiry and a statement, if necessary, of any other conflict of interest.

The ACC will allow the panel, upon its request, to interview individuals if they do not object to it, he said.

According to the information and evidence that the ACC investigation team has gathered, so far no allegation of corruption has been established in the project. “If the corruption allegation is proved, it will be placed at the prosecution level,” he said.

The ACC chief said the team would quiz Abul if necessary.

“I don’t want to influence the investigation process. The probe team has already talked to many people and it will make decisions.”