Govt revives Bogura-Sirajganj rail project after Indian credit impasse
Asian Infrastructure Investment Bank now shows interest in financing
The government has taken a fresh initiative to implement the long-delayed Bogura-Sirajganj dual-gauge railway project, with the Asian Infrastructure Investment Bank (AIIB) showing interest in financing after Bangladesh moved away from Indian credit.
According to Bangladesh Railway documents, the revised project proposal places the total cost at Tk10,391 crore – nearly double the original estimate.
The project was initially approved by the Executive Committee of the National Economic Council (Ecnec) in 2018, with an estimated cost of Tk5,579.7 crore. It was planned to be implemented under India's Line of Credit (LoC). However, delays in approval procedures at India's Exim Bank meant little progress was made over the years.
Following the change of government last year, Bangladesh decided not to proceed with several projects under Indian financing, including this railway scheme. As a result, Bangladesh Railway has begun seeking alternative sources of funding. Among the development partners currently in discussion, the AIIB has expressed preliminary interest, although final approval has yet to be secured.
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Railway officials said the project was earlier allocated $379.29 million under India's second LoC. Due to delays in implementation and escalating costs, Bangladesh proposed an additional $300 million loan from the Exim Bank in 2024, but the financing did not materialise.
Project Director Abu Jafar Mia told The Business Standard that the government has given the project the highest priority, describing it as a key infrastructure initiative for the northern region. He said once funding is confirmed, the tender process will begin immediately, accelerating implementation. Rising land prices and construction costs, however, have pushed the overall project cost beyond Tk10,000 crore.
Jafar Mia added that the design and feasibility studies have already been completed, eliminating the need for further studies and saving several years. Around 900 acres of land will be required for the project, and funds have already been provided to the district administrations for land acquisition. As the route passes through largely greenfield areas, officials expect the acquisition process to be completed swiftly.
A regional game changer
Railway authorities view the project as a "game changer" for rail connectivity in northern Bangladesh. Once completed, the new line will reduce the rail distance between Dhaka and the northern region by 114 kilometres and cut travel time by up to three hours. It will provide faster and more reliable rail links to Rangpur, Gaibandha, Lalmonirhat, Kurigram and Bogura, significantly improving passenger and freight movement.
Given that rail transport is safe, cost-effective and environmentally friendly, the new dual-gauge line is expected to attract fresh investment to the northern region and generate substantial employment opportunities. Improved freight and passenger services are also expected to support broader socio-economic growth.
Bangladesh Railway has formally written to the Economic Relations Division (ERD), seeking assistance in securing foreign financing from alternative sources. ERD officials confirmed that the AIIB has shown initial interest and will be formally approached, while discussions may also be held with other development partners offering more flexible lending terms.
Under the revised plan, construction is scheduled to begin in January 2026 and be completed by December 2029. Of the total proposed cost of Tk10,391 crore (approximately $852.99 million), foreign loans will account for Tk5,874.17 crore, with the rest provided by the government.
The project includes the construction of an 85.67km dual-gauge main line from Bogura to the western end of the Jamuna Bridge at Saidabad, along with 37.49km loop lines. It also includes the acquisition of around 900 acres of land, construction of eight new stations, conversion of three existing stations into junctions, building of 212 bridges, and installation of modern signalling systems at 11 stations.
