Padma Bridge earns Tk 7.95b in first year of operation
Sunday marks the first anniversary of launching the Padma Bridge. It registered remarkable achievements throughout the maiden year of operation. As of Friday, the bridge collected an amount of Tk 7.95 billion as toll from some 5.6 million vehicles that used the bridge throughout the year, according to the bridges division.
Since its launching, the Padma Bridge has considerably reduced travel time for both people and goods. A journey from Sayedabad in Dhaka to Barishal now takes only three to four hours. Similarly, the travel time from Dhaka to Khulna has been reduced to just four hours.
The landmark infrastructure took one and a half decades to be constructed and got its project costs multiplied in phases. Following complications in getting a loan from the World Bank, the project eventually took shape with domestic funding.
Two key contractors of the construction project were from China while a South Korean firm worked as consultants. Around 90 per cent of the materials were procured from abroad. Hence, a large portion of the money invested by the finance ministry was spent to pay bills of the foreign contractors and consultants.
Now, the bridge authority is paying back the money to the finance ministry. A total of Tk 3.16 billion was paid to the ministry as the first and second installments of the loan on 5 April this year.
Later, the bridge authority repaid another Tk 3.16 billion as third and fourth installments of the loan on 19 June, taking the total amount of repayment to Tk 6.32 billion.
While undertaking the project in 2007, the authorities had estimated the consolidated cost at Tk 101.62 billion. But the cost eventually stood at Tk 326.05 billion after completion. As per the loan agreement, the bridge authority would pay back the money, along with 1 per cent interest, to the finance ministry within 35 years.
According to the bridge authority sources, the revenue generated in the first year is expected to increase further in the coming years. Rail track, gas, electricity, and various service lines have been installed on the bridge with the project cost.
The bridge authority now bears the entire cost. However, it is now in negotiations with railway and power divisions over two possible alternatives to lessen the loan burden.
Bridges division secretary Monjur Hossain said the Padma Bridge fulfilled the toll collection target. They are paying back the loan money to the finance ministry as per the agreement. The price of its contribution to GDP and smooth movement of people is even higher.
Survey and reality
Survey predictions regarding vehicle movement and toll rates on the Padma Bridge, initially made assuming its opening in 2014, were not fully materialised due to delays.
The consultants estimated that the bridge would accommodate 23,954 vehicles daily by 2022, with a projected increase to 34,725 in 2029, and 66,829 in 2050.
In reality, the average daily traffic in the first year of operation was around 15,500. The number of vehicles had risen to 25,108 on 23 June.
The authorities had suspended motorbikes on the bridge after a tragic accident within one day of its inauguration. However, the suspension order was lifted ahead of the last Eid-ul Fitr, which pushed up the number of vehicles on the bridge.
According to a study, the toll revenue from the bridge was predicted to be Tk 13.23 billion in 2022 and Tk 18.04 billion in 2029 and Tk 33.79 in 2050. If the survey is taken into account, the Padma Bridge is supposed to be profitable from 2029 onwards. The authorities have to raise the toll rate by 10 per cent after every 15 years to materialise the projection.
The Padma Bridge is lagging behind in terms of the number of traffic it accommodated and revenue in the first year. However, the bridges division said they expected 6,500 vehicles to use the bridge in the first year of operation in 2014. In this sense, they exceeded the projection.
Expenses
According to the agreement with the finance ministry, the government will receive 15 per cent of the total collected toll as VAT. The Korea Expressway, a contractor employed to collect tolls, will be paid Tk 6.93 billion in the first five years.
Besides, there are maintenance and repair costs on the bridge. With the remains, the bridges authority repays the loans to the finance ministry.
Excluding all these expenses, the surplus amount is considered as profit. However, the government receives 25 per cent of the profit as tax again.
* The report, originally published in the print edition of Prothom Alo, has been rewritten in English by Misbahul Haque