Karnaphuli tunnel cost increases by Tk168.83cr

The cost of Karnaphuli Tunnel construction is going to increase by 1.63 per cent, or Tk 168.83 crore, and implementation deadline for the mega project may be extended by a year.

In this regard, the Bridges Division has recently sent a second revised project proposal to the Planning commission seeking the additional fund and extension of time frame, a senior official of the Planning Ministry told The Business Post.

“The cost of the project has increased due to increased foreign currency exchange rates and project activities. Cost has also increased in purchase of service area accessories, electronic equipment and furniture. The other reasons behind raising the cost are VAT and increased expenditure in the IT sector,” he added.

The official said the dollar rate was at Tk 80 when the G2G agreement was signed with the Chinese government. The first amendment raised the value of the dollar to Tk 83.78. But now in the proposed second amendment, the value of the dollar has increased to Tk 95. As a result, the value of the money given by the lender Chinese Exim Bank has depreciated against the dollar.

Now, the project cost has increased to Tk 10,543.25 crore and implementation deadline to December 2023.

Initially, the estimated project cost was Tk 10,374.52 crore and it was scheduled to be completed by December 2022.

In the last seven years, the project has witnessed 87 per cent physical progress and the rest 13 per cent still remains to be completed. The implementing agency spent a cumulative expenditure of Tk 8,028.90 crore. The financial progress of the project is 77.39 per cent.

“We have held a project evaluation committee meeting on the project. The cost of the project has proposed to increase due to increase of the exchange rate of dollar and other sub sectors,” the planning ministry official said.

Sources said the total length of the tunnel will be around 9.092 kilometres with 3.40 kilometres under the Karnaphuli River, an 4.89 kilometres approach road and a 740 metres bridge. The tunnel will connect the main port city and western side of the Karnaphuli along with the heavy industry-prone eastern side of the river.

After completion, the tunnel will shorten the road distance between Chattogram and Cox’s Bazar and facilitate traffic on Dhaka-Chattogram Highway.

Prime minister Sheikh Hasina on Saturday joined an event marking an end to the general work of Karnaphuli Tunnel’s south tube, officially announcing the completion of the tunnel’s south side.