Major Irregularities in Rail Engine Purchase Plan: A Masterplan to Embezzle Huge Funds?

There has been news in the media that China is giving 20 railway engines to Bangladesh for free. This will partially solve the meter gauge engine crisis of Bangladesh Railways. There was no match between the headline of the newspaper and the inside news.

The published news says: “China is providing a grant of $1.2954 billion (about Tk 1,591 billion) as assistance for the purchase of 20 meter gauge (MG) locomotives for Bangladesh Railway (BR).” That is, China is not providing engines, but is providing financial assistance for the purchase of engines. The Ministry of Railways has sent a proposal titled ‘Procurement of 20 meter gauge diesel electric locomotives for Bangladesh Railway under China Grant’ to the Economic Relations Division (ERD) and the Planning Commission in this regard.

According to the PDPP, the total cost of the project to procure 20 engines is estimated at 1,635 crore taka (about 1,331.2 million dollars). Of this, 1,591 crore taka will be provided by China and the remaining 440 crore taka (about 35.8 million dollars) will come from government funds. The government will have to spend 440 crore taka for the free engines!

India has gifted a total of 30 engines to Bangladesh (10 in 2020) and 20 in 2023. These are now being serviced on the western railways. These engines received as gifts are on average 8 years old. The normal lifespan of a diesel engine is 20 years. These engines can last for 30/35 years after being serviced in Bangladesh. If China wants to give them to Bangladesh for free, they can give them used old engines. Because we now urgently need meter gauge engines.

If China, like India, gives Bangladesh its 8/10-year-old (good condition) engines as a gift, then there is no room for fraud there.

Now let’s come to the real blunder. Sheikh Hasina’s government saved Tk 6,670 crore on the Dohazari-Cox’s Bazar railway line project funded by ADB. A new project is now underway by combining that money – the construction of the Dohazari-Chittagong dual-gauge railway line and the procurement of new engines.

During Sheikh Hasina’s government, the railways went a long way to purchase 30 new meter gauge rail engines from South Korea’s Hyundai Rotem Company for Tk 1,500 crore under this project. When the government changed on August 5 last year, the Yunus government canceled that project. The Yunus government wants Chinese funding for 20 new engines. China has said that it will consider this money as a grant to the interim government.

The railways are now going to invite tenders to procure these engines. Since China is giving them as a grant, these engines will have to be purchased from China. Yes, they will have to be purchased.

The real game is here. Instead of 30 Hyundai Rotems for 1500 crore taka, Chinese engines will now be purchased for 1635 crore taka. If the engines were purchased from Korea, each one would cost 30 crore taka plus. Earlier, Sheikh Hasina’s government had purchased diesel-electric locomotives for 28-30 crore taka. But to buy each new Chinese engine, it will cost about 80 crore taka! Where is 30 crore and where is 80 crore!

Do you understand the real game now? How many crores of taka have been stolen per engine? Who is worried about who will get a share of this money?

Sheikh Hasina’s government bought 40 powerful diesel-electric locomotives of 3300 horsepower of broad gauge from the United States for 280 million taka each. Hyundai bought 30 meter gauge locomotives from Rotem for 380 million taka each. It will take at least 36-42 months for the engines purchased with Chinese money to be delivered to the country. That is why the Yunus government has become so impatient to tender now, I hope everyone understands.

All arrangements have to be made quickly so that the elected government after the elections cannot spill water on this happy dream. This is the new arrangement of the new country.

Author Profile: Political and Economic Analyst