Malaysia likely to form JV to build the Padma Bridge

The Daily Star August 6, 2012

Malaysia considers appointing an inexperienced company as the concessionaire of Padma bridge project and will soon send the final proposal in this regard to Bangladesh, the communications ministry sources said yesterday.

Malaysian group Axisjaya has built military camps and houses in that country, according to its website that has no mention of bridge construction on the list of project gallery.

But the company would be assigned to build the Padma bridge in joint venture with Korean Samsung, one of the five companies technically pre-qualified for the main bridge construction.

I’ll not, Quader will speak: Muhith

A Malaysian technical committee hinted about the joint venture during a meeting with Bridge Division officials at Setu Bhaban yesterday. Technical bodies of the two countries there discussed a number of issues, including the design.

They are expected to sit again today.

At the meet, Bridge Division officials wanted to know from Malaysian side about the firm to be engaged in the bridge construction and from where the cost will be managed.

“They told us that everything will be described in the final proposal,” Shafiqul Islam, director of Padma bridge project, told The Daily Star last night.

Communications Minister Obaidul Quader yesterday said Malaysia will submit the final proposal in three weeks.

He made the announcement after a meeting with another Malaysian team at the Secretariat. Dato Seri S Samy Velu, Malaysian prime minister’s special envoy to India and South Asia, led the six-member-delegation.

The Malaysians also submitted to the minister a proposal on concession agreement for the construction of 6.15-km rail-road bridge.

The proposal includes time and cost of the bridge construction and how the cost will be recovered, sources said.

“On technical grounds, we cannot disclose the details [of the meeting] before the final proposal submission,” Quader said. “We have got to calculate many things.”

He said Bangladesh and Malaysia have been in talks since January on the project financing.

“Today’s meeting and the concession proposal are part of the process,” said the minister, adding that the two technical committees will examine everything about the Malaysian offer.

Terming the Padma bridge a dream project for the government, Quader said Bangladesh did not accept or cancel anything yet.

He, however, said anyone can come up with a proposal, but nothing will be done compromising interests of the country and its people.

Before signing the agreement, the draft of the final proposal will be sent to the law ministry for scrutiny and then to the cabinet, the minister said, adding that there might even be a consortium comprising local and foreign donors.

Asked when the construction might start, he said the Malaysian delegation expressed their interest to start the work this year.

The head of Malaysian delegation will meet Quader again this afternoon.

Emerging from the meeting with the communications minister, the team held a half-an-hour discussion with Finance Minister AMA Muhith at the Secretariat.

But both the minister and the Malaysian team leader declined to make any comments when the meeting ended around 1:30pm.

Malaysia in January formally proposed to finance the project. On April 11, Dhaka and Kuala Lumpur signed a memorandum of understanding for cooperation in the Padma bridge construction.

The government had signed a $1.2 billion loan agreement with the World Bank to construct the bridge. Besides, the Asian Development Bank was to provide $615 million, Japan International Cooperation Agency $400 million and Islamic Development Bank $140 million more for the scheme.

But the project stalled in October last year when the lead financier WB brought allegation of corruption in the bidding process. The WB finally on June 29 cancelled its loan pledge for the $2.9 billion project.

Amid uncertainty over its implementation, several countries showed interest to fund the construction of long-cherished Padma bridge.

Dhaka, Aug 5 (bdnews24.com)

Communications Minister Obaidul Quader said on Sunday Malaysia will submit a final proposal on the Padma bridge project in three weeks.

After meeting Malaysia’s Special Envoy to South Asia on Infrastructure S Samy Vellu, Quader told reporters, “The Malaysian delegation has placed the concession agreement of the [Padma bridge] project on the costs during and afterwards the construction and how it will be returned.”

He would not be drawn on the specifics of the concession agreement before the final proposal is in.

“There are some strategic problems if I talk about it,” Quader added.

The meeting between the Communications Minister and a seven-strong Malaysian delegation, led by Vellu, began around 11:45am and ran for an hour.

The envoy also met Finance Minister Abul Maal Abdul Muhith on Sunday noon on the proposal submitted on Jun 28 to build the Padma bridge.

But the Finance Minister declined to say anything about their meeting. He told reporters, “I won’t say anything. The Communications Minister will say what is necessary.”

Quader said the final proposal will be screened. “The evaluation committee headed by Dr Jamilur Reza Chowdhury will examine Malaysia’s final proposal. Then it will be sent to the law ministry for vetting. The Cabinet will take the final decision about the proposal after that.”

Though he did not say anything clearly about what the Malaysians proposed, the minister said the final proposal will be a ‘win-win’ one for both countries.

Asked whether the government has abandoned the idea of building the bridge with its own funding, Quader said, “The government has ditched the Cabinet’s decision. But why would we say no if anybody wants to help?”

He also said the possibility of establishing a consortium, led by Bangladesh, to build the Padma bridge cannot be ruled out.

Asked whether the Malaysian envoy said anything about beginning the bridge’s construction, Quader told reporters, “They want to begin the work within this year.”

Earlier, Quader had told reporters that he will take iftar with the Malaysian envoy and have a second meeting with them at 3pm Monday.

Dhaka had contacted Kuala Lumpur to construct the 6.15-kilometre long Padma bridge, which would connect the capital with 16 districts of backward south-western region, after the Bangladesh government ran into a dispute with the World Bank.

The global lender in Jun 29 pulled out of the $2.9 billion project raising corruption allegations, throwing funds pledged by the other donors into uncertainty.

The governments of Bangladesh and Malaysia on Apr 10 signed a memorandum of understanding in Kuala Lumpur on cooperation in the construction of the bridge and associated facilities.

On May 28, a delegation of the Malaysian government, led by Samy Vellu, had submitted a proposal to the Communications Minister to build the country’s largest infrastructure.

Meanwhile, Asian Development Bank (ADB) and Japan International Cooperation Agency (JICA) extended their loan deal for the project by a month last Wednesday after the government had written to the three other donors including Islamic Development Bank (IDB) to keep the funds available.

Of the proposed $2.9 billion project, the World Bank had agreed to provide $1.2 billion and ADB pledged $610 million. The Jeddah-based IDB is to provide $140 million and JICA said it would contribute $400 million in the project.

On Jul 1, Muhith in a press conference refuted the corruption charges the World Bank had levelled against the government in cancelling its loan and urged the global lender to review its decision.