No new mega projects, govt to prioritise foreign-funded ones

The interim government has decided not to initiate new mega projects and instead focus on those funded by foreign aid, said Planning Adviser Professor Wahiduddin Mahmud today (18 September).

After the first meeting of the Executive Committee of the National Economic Council (Ecnec) under the interim government, Wahiduddin told reporters that the implementation of the 8th Five-Year Plan will be paused and the work on the 9th Five-Year Plan, scheduled to begin next year, will be postponed for now.

He suggested that such a long-term development plan should be crafted by a political government.

The Ecnec yesterday approved a total of four development projects, two new and two revised, involving an overall estimated cost of Tk1,222 crore.

Chief Adviser to the interim government Muhammad Yunus presided over the meeting held at the Chief Adviser's Office in the city's Tejgaon area. 

Planning and Education Adviser Wahiduddin Mahmud briefed the reporters after the meeting at the NEC Conference Room in the city's Sher-e-Bangla Nagar area.

Criticising the previous government's approach, the planning adviser said the Bus Rapid Transit (BRT) project was an example of how large-scale initiatives were undertaken without proper planning.

"The BRT bus transit project was taken without adequate planning, resulting in the narrowing of a major road. Experts predict the road needs to be overhauled in the future," he said.

Wahiduddin also mentioned the Faridpur-Bhanga-Barisal-Patuakhali-Kuakata Highway Upgrade Project. Although this project was on the meeting agenda, it was not discussed and will be reevaluated due to massive cost overruns due to land acquisition.

Approved in 2017 with a budget of Tk1,868 crore, the revised proposal now suggests a cost of Tk5,900 crore.

"We will reevaluate all projects carefully, focusing first on those with foreign financing since we need international funding. There are billions of dollars worth of projects pending approval. However, not all foreign-funded projects are viable," he said.

Projects of group interest

Wahiduddin Mahmud announced the approval of a project to drill four gas wells with a budget of Tk588 crore.

He said this project, which has been delayed for some time, aims to enhance domestic gas production and reduce import dependency.

However, the previous government focused solely on LNG import projects, which were awarded to foreign firms.

At this point, Md Mustafizur Rahman from the Industry and Energy Department of the Planning Division, said, "In our country, if 20 wells are drilled for gas exploration, nearly 18 will yield gas. Yet, few such projects have been approved by the previous government."

"A project is not inherently problematic if driven by political motives, as any government will prioritise projects based on political considerations. However, projects influenced by politically motivated interest groups can become corrupt," he added.

8th FYP suspended

Wahiduddin Mahmud said, "For too long, the focus has been solely on infrastructure projects, while projects involving human resource development, skill enhancement, technology advancement, and competitiveness have been overlooked."

Employing unskilled women workers for apparel, sending unskilled workers abroad, and the lack of agricultural technology have been going on for a long time. However, without improvements in efficiency, productivity, and technology, advancing to a new stage of development is not possible, he said.

"If we do not enhance our skills and competitiveness, we risk losing many trade advantages, especially as our economic landscape evolves after LDC graduation. We will need new trade agreements. Thus, new projects in education and technology are essential," said the adviser.

"Hence, we are suspending the 8th Five-Year Plan and will focus on initiating projects related to worker training and education," he said.

Wahiduddin said the current 8th Five-Year Plan gets suspended automatically as it does not align with the budget prepared by the Ministry of Finance. And the new Ninth Five-Year Plan will be developed by a political government, as political decisions should be made within a political framework.

The adviser said to provide a new direction for the country's economy and its financing, the interim government has recently established a task force, which is expected to submit its report within three months.

The 9th Five-Year Plan, which was being developed by the General Economic Division of the Planning Ministry, was scheduled to start on 25 July 2025 and run until June 2030.

The 8th Five-Year Plan, covering the period from July 2020 to June 2025, was approved by the National Economic Council under then prime minister Sheikh Hasina on 29 December 2020.

Development budget size to be revised

The planning adviser said that it is currently difficult to estimate the total funds needed for the remainder of this fiscal year, the amount of foreign aid available, or the final size of the development budget.

There is ongoing uncertainty regarding domestic resource mobilisation each year, and the current financial year has already seen severe political upheavals, leading to unpredictability in revenue collection, he continued.

However, development partners are willing to provide financing. USAID has expressed readiness to fund any project, and other bilateral and multilateral development partners are also expected to contribute, Wahiduddin said.

"In about four to five months, we will have a clearer picture of the development budget size, resource distribution within the country, and the budget deficit required to control inflation. Addressing inflation is a significant concern, and we prioritise the quality of budget implementation over its size," he added.

Project approval and implementation process to be reformed

The planning adviser questioned — who would be held accountable for errors in the approval and implementation of development projects.

The Ecnec meeting decided to revise the Planning Commission's circulars on the processing, approval, and execution of development projects. The commission will assess the effectiveness of the circular. If it proves effective, there will be no need for repeated delays in project implementation or additional allocations, he said. 

Additionally, the commission will investigate why the costs of major projects have often exceeded international estimates by three to four times and will address these issues accordingly, said the adviser.

WB for diverting funds from inactive projects

Wahiduddin Mahmud said that the World Bank has identified several projects where funds remain unspent due to various complications.

The World Bank has proposed reallocating the unused funds from these projects and is prepared to provide $1 billion in budget support by December.

He added that similar issues may exist in other projects funded by other development aid agencies, and resources from these stalled projects should be relocated.

Family planning engaged women in the workforce

Wahiduddin Mahmud said it was the family planning programme, not the microcredit which engaged the women from the middle class and lower middle class to the workforce in the country.

"Many of you do not know that in Bangladesh the middle class and lower middle class women started working outside their home not for the microcredit, it was for the family planning workers who worked to inform people door to door," he said.

He mentioned that the health workers, especially the family planning workers, used to go to every door in the 80's. It was extremely successful and made an example to the whole world. 

As a result, he said that the birth rate was controlled, which did not happen in any developing country across the globe. As a result of reducing birth rate, the child death rate was also reduced, and the country had made tremendous progress in the social development index. 

However, the adviser regretted that the programme was stopped and the birth rate is stagnant in one place.

Four projects get Ecnec approval

Two new and two revised development projects involving Tk1,222 crore were approved today. 

The planning adviser said that out of the overall outlay of Tk1,222 crore, Tk964 crore will come from the government, Tk100 crore as project assistance and the rest of Tk158.16 crore from the concerned organisation's own fund.

The two newly approved projects are — Two Appraisal Cum Development Wells (Sundalpur 4 and Srikail 5) and Two Exploratory Wells (Sundalpur South 1 and Jamalur 1) involving Tk588.40 crore and Sustainable Social Services Delivery in Chattogram Hill Tracts (2nd Phase) Project involving Tk400 crore.

Two revised projects are — The Bakhrabad-Meghnaghat-Haripur Gas Transmission Pipeline (1st revised) Project with an additional cost of Tk70.63 crore and Tottho Apa: Empowering Women Through ICT Towards Digital Bangladesh Project (2nd phase and 2nd revised) with an additional cost of Tk163.11 crore.

The planning adviser said the title of the Tottho Apa project would be changed.