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Sunday, April 10, 2016, Chaitra 27, 1422 BS, Rajab 2, 1437 Hijri

Investment in Padma Bridge to bring double benefits
Copenhagen Consensus Center says
Published :Sunday, 10 April, 2016,  Time : 12:00 AM  View Count : 43
Business Correspondent
Each taka being invested in the Padma Bridge will produce about Tk 2 worth of social good, says a research by Copenhagen Consensus Center (CCC), registered in the United States.
A report on the research released on the CCC website on Saturday said the study shows that 'even though the longstanding Padma Bridge project has been hindered by significant delays and cost overruns, the project is still cost beneficial.
The research is a part of Copenhagen Consensus Center project - Bangladesh Priorities aims to identify the best policies for Bangladesh: the choices that will do the most good for each taka spent.
Senior economist at the Policy Research Institute of Bangladesh Ashikur Rahman and economics professor at Dhaka University Bazlul Haque Khondker conducted the study.
"Padma Bridge project was very attractive when first proposed, and a key concern was whether it may become less attractive or infeasible due to sharp cost increase," the report quoted Bazlul Khondker as saying.
"Our revised benefit-cost analysis shows that even given the escalated cost, the benefits will outweigh costs on balance," he added.
According to the Bangladesh Bridge Authority's latest estimate, the total cost of the project has risen to Tk 287.93 billion (Tk 28,793 crore)-nearly three times higher than the originally projected cost.
But the analysis demonstrates that price inflation and currency depreciation accounted for 91 per cent of the cost increase from 2007 to 2015, and the overall benefits still justify it.
"Benefits of building road and rail transportation across the river would come from three main sources: decreased vehicle operating costs, increased time-savings, and a boost in GDP due to increased economic activities," it added.
Currently, drivers have to use longer and poorer roads on alternate routes to cross the river.
"Once the bridge is complete, vehicle-operating costs will fall significantly," it said. "Savings in travel time will account for nearly one-quarter of total benefits of the project."
According to the research calculation: "Over the 31 years following completion of the bridge, overall benefits to road users from these two sources are projected to be Tk 1.3 trillion(Tk130,000crore)."
Over that three-decade timeframe, the economists estimate, the bridge will reach its full traffic capacity of 75,000 vehicles each day.
The research added, "One-third of those vehicles will be trucks, which carry cargo and boost trade.
"The increased economic activity, thanks to the Padma Bridge, stands to permanently increase GDP of the southwest region by up to 2.5 per cent."
On March 17, Copenhagen Consensus Center in its another research said Bangladesh can achieve Tk 2 worth of social good for spending Tk 1 on graduation - a strategy to provide assistance to poor people.

Editor : Iqbal Sobhan Chowdhury
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