Public Disclosure Authorized
Docunent
of
The WorldBank
FOR OFmFCIALUSE ONLY
GZ ~~z
Z_ 73Z
lx
Public Disclosure Authorized
Public Disclosure Authorized
Public Disclosure Authorized
Rqeot No. 8815-BD
STAFF APPRAISALREPORT
BANGLADESH
THIRD INLANDWATERTRANSPORTPROJECT
APRIL 9, 1991
InfrastructureOperationsDivision
Country DepartmentI
Asia Regional Office
.bis document hasa restrited distribution
and may be usedby recipknt
onlyIo theperforancee of
their
offical duis Its contents may not otherwise be diclosed without WorldBn autorzaton.
CURRENCYAND EQUIVALENTUNITS
(As of May 1, 1990)
CurrencyUnit US$1.00
=
Taka 1.00
=
Taka (Tk)
Taka 34.22
US$0.0292
WEIGHTS AND MEASURES
km
m
km
ton
=
=
kilometer (0.62miles)
meter (39.37 inches)
square kilometer (0.386 sq. miles)
metric ton (2,204 lbs)
ABBREVIATIONS
ADP
BIWTA
BIWTC
BR
DOS
DPTC
EPC
FINNIDA
FYP
GOB
HF
ILO
IMSCT
ISSA
IWT
JGF
LAD
MARPOL
MOS
PIP
PM4U
REI
RHD
UNDP
= Annual DevelopmentPlan
= BangladeshInland Water TransportAuthority
m BangladeshInland Water Transport Corporation
BangladeshRailways
Departmentof Shipping
Deck Personnel TrainingCentre
EnvironmentalPollutionControl
Finnish InternationalDevelopmentAgency
= Five Year Plan
Governmentof Bangladesh
High Frequency
InternationalLabour &ffice
= Inter-Ministerial
Steering Committeeon Transptrt
Inland Ship Safety Administration
Inland Water Transport
Japan Grant Facility
= Least Available Depth
Marine PollutionConvention
=
Ministry of Shipping
a Priority InvestmentProgram
Project MonitoringUnit
Real ExpenditureIndex
- Roads and Highways Department
= United Nations DevelopmentProgram
FISCAL YEAR
July 1 - June 30
USEONLY
FOROFFICIAL
BANGLADESI
PROJECT
TEIRD INLANDWATERTRANSPORT
Credit
and Project
Sumar
Borrowers
The People's Republicof Bangladesh
Beneficiaries:
BangladeshInland Water TransportAuthority (BIWTA)
BangladeshInland Water T:ansportCorporation(BIWTC)
Amount:
SDR 31.3 million (US$45.0million equivalent)
Terms:
Standard,with 40 years maturity
Cofinanciers:
FinnishInternationalDevelopmentAgency (FINNIDA)with a grant
of US$5.0 million equivalentto fund technicalassistance;and
Japan Grant Facility (JGF) with a grant of US$0.7 million
equivalentto fund environzentalaspects of the project.
OnlendisuTermss
Government to onlend to BIWTA (US$35.5 million) and BrWTC
(US$11.4million)for 25 years, includinga 5 years grace period
on principal,at an interestrate of 11.5 percentper annum, and
these loans would incladeboth the proceeds of the IDA credit
and the Government'scontribution. The remainingproceeds of
the creditwould be providedas a grant to DOS.
Project
Descrigtion:
The projectwould improveinlandwater transportoperationsand
improving
the effectiveness of sector agencies through:
waterway safety and environmentalcontrols; improving inland
water transport infrastructure; $mproving capital asset
utilization; reducing inland water freight transport costs;
of BIWTAand BIWTC; and
improving the finances and operations
and policy
for planning
capacity
institutional
improving
of inland vessel operators.
and for the training
formulation,
(a) an institution-building
of:
would consist
The project
component which would enhance the capacities of (i) DOS to
implementsafety and pollutioncontrol regulations,including
environmentalmonitoringof dredging,and to train inlandvessel
operators, (ii' BIWTA to improve its planning function and
operations, and (iii) BIWTC to restructure its fleet,
organization,personnel, and finances; (b) a vessel safety
improvementcomponentwhich would include (i) implementationof
minimum navigation standards for day and night navigationon
Class I and II waterways,and (ii) upgradingof high frequency
communicationssystems and establishmentof 24-hour distress
frequencymonitoring at Chittagong,Dhaka and Mongla; (c) an
inland ports componentto provide 100 launch landing pontoons
in rural areas; (d) a waterways developmentcomponentwhich
would include (i) dredging to improve waterway access to she
(ii)
and to Baghabari Port in the northwest,
northeast
hydrographic survey equipment, and (iii) support equipment to
improve productivity of BIWTA'sexisting dredging fleet; and (e)
a country boat component to provide extension services to the
country boat sector.
Thisdooumenthas a restricteddistributionand may be used by recipientsonly in the performance
officialduties.Its contents may not otherwisebe disclosedwit AtWorldBankauthoriltion.
of their
Benefits
and Risks3
Benefits of the project ore expected froms (a) reduction*in
vessel casualties;(b) reductionsin the unit costs of dredging;
(c) reductionsin waterway transport costs on routes improved
by dredging and by allowing night navigation on additional
routes; (d) savings in vessel and passenger time and cargo
losses;and (e) improvedenvironmentalmonitoringof operations.
Delays in project implementation,particularlywith regard to
institutionaland operationalimprovementaction plans, are the
main project risks. To address this, IDA will require the
establishmentof a Project MonitoringUnit within the Ministry
of Shipping to secure 1,igh level oversight of project
implementation.
Pro3ect Costs:
Local
Foreign
Total
-(US$ million)-------
Dredging
Aids-to-Navigation
Inland Pontoons
Equipment
Technical Assistance
Base Cost
1.4
2.0
1.9
1.0
6.3
3.0
5.4
5.5
17.2
5.5
36.6
3.0
6.8
7.5
19.1
6.5
42.9
Physical Contingencies
Price Contingencies
Subtotal Contingencies
0.6
1.3
1.9
3.7
6.9
10.6
4.3
8.2
12.5
Project Costs
Taxes and Customs Duties
TOTAL PROJECT COSTS
8.2
8.8
.17.0
47.2
_
47.2
55.4
8.8
64.2
rinancingPlans
Local
Foreign
Total
------ (US$ million)-------
--
Government
6.1
--
6.1
BIWTA
5.4
2.0
--
5.4
2.0
5.0
0.7
41.5
47.2
5.0
0.7
45.0
64.2
BIWTC
Finland (FINNIDA)
Japan (JGF)
IDA
TOTAL
--
-3.5
17.0
Estimated Disbursements:
IDA Fiscal Year
Annual
Cumulative
FY92
FY93
FY94
FY95
FY96
FY97
FY98
FY99
1.3
1.3
5.7
7.0
4.7
11.7
7.2
18.9
9.0
27.9
6.3
34.2
8.1
42.3
2.7
45.0
Economic Rate of Returns
About 26 percent on componentsfor which benefitswere
quantifiable,accountingfor 71 percent of project cost.
-
S~3
THIRD INLAMP VATE TRANSPORTPROJECT
STAF APPRAISALREPORT
Table of Contents
Pge o.
I.
II.
_II.
-
IV.
V.
T9ETRANSPORT SECTO...
1
A.
B.
C.
D.
1
2
3
3
.
.
.........
.
The Three Surface TransportModes......................
Sector Organization
....................................
Sector Financing......
. .......................
. .......
IDA's Sector Role and Assistance Strategy.........O-*
INLAND WATER TRANSPORT.
..
.......................
.5..........
,
A.
Performanceof Inland Water Transport.....
s..
B.
InstitutionalFramework
................
.
C.
DevelopmentObjectivesand Strategy....................
D.
Public Expenditurefor Inland Water Transport ..........
6
6
7
8
THE PROJECT............................................................
9
A.
Project Origin
r
.
10
B.
Objectives
...
10
C.
Project Descriptionscrin...
10
D.
Cost Estimates .............
12
E.
Financingand Disbursement
13
F.
Project Implementation
....................
15
G.
Supervisionand Monitoring
16
H.
Procuremento
c
u
r
e
m
e ......... nt...
17
I.
Reporting......................................
is
INSTITMTIONALD
IVPLO9
ENT................
. .... *.** .... .
;.
BangladeshInland Water TransportAuth
ority
B.
BangladeshInland Water TransportCorporation..........
C.
Departmentof Shipping.................................
D.
Implementationof Agreed Action Plans.
.........
18
18
19
19
20
FINANCIAL
ANALYSIS......
A.
B.
C.
.................
21
BangladeshInland Water TransportAuthority............ 21
BangladeshInland Water Transport Corporation.......... 23
Accounts and Auditsu..............
................
26
This report is based on the findingsof an IDA AppraisalMission in March 1990.
Mission members included Messrs. George Tharakan (Mission Leader, Transport
Economist),JonathanKamkwalala(FinancialAnalyst)of the IDA, and Aladin Fateen
(Engineer,Consultant). The report haa been endorsed by Messrs. D. Groves
(Acting Director,Asia Region, Country Department I), and M. J. Staab (Chief,
InfrastructureOperationsDivision). The peer review team consistedof Messrs.
A. Bruestle (Environment),K. C. Chung (Engineering),
P. McCarthy (Finance),M.
Si Parthasarathi(Economics),and S. Paul (PublicSector Management).
Palo. go.
VI.
*
.....
..............
...
PROJECT JUSTIIICATION.
......
A.
Economic Cost Estimates..
......................
B.
Estimationof Benefits
Economic Rates of Return and SensitivityAnalyses
C.
.........................
D.
EnvironmentalAssessment .
...
.............
.
E.
Special Considerations..
P.
Project Risks........
.........................
AGRZHIENTSREACHUM AND UCOIMNDATION
VII.
..
2.....
26
27
,
.
27
28
28
29
30
30
TEXT TABLES
1
Table 1.1 Modal Shares in Passenger and Freight Transport...........
Table 2.1: Total Public Resources and IWT Outlays for the
9
t*,**.
.....
.....
......
Fourth Plan Period
12
Summaryof Project Cost Estimate.........................
Table 3.1
13
...... ........................
Plan
Table 3.2: Project Financing
17
Table 3.3s Distributionof Credit Proceedsby ProcurementMethod.....
BIWTA'sPast FinancialPerformance........................ 22
TableS.1s
Table 5.2: BIWTA's ProjectedFinancialPerformance................... 23
Table 5.3s BIWTC's Past FinancialPerformance....................... 24
Table 5.4: ProposedChanges in BIWTC Tariffs......................... 25
Table 5.5: BIWTC's ProjectedFinancialPerformance................... 2'
Table 6.1: EconomicRates of Return and Net Present Value of
28
.. ........
........
.......
Project Components
ANNEXES
Annex 1
Annex '.
Annex
Annex 4
Annex 5
Annex 6
Annex 7
Annex 8
Annex 9
Annex 10
Annex 11
Annex 12
.
Annex
Annex
Annex
Annex
Annex
Annex
Annex
-
13 14 15 16 17 18 19 -
33
Inland Water Transport Sector.
40
Priority InvestmentProgram.
41
Criteria for Launch Pontoon Locations............
42
n
a
BIWTA OperationsImprovementAction Pl
49
......
...
....
BIWTCStrategicPlan
61
InstitutionalDevelopmentAction Plans
* 68
............................
EnvironmentalActions......
70
ExtensionFacilitiesfor the Country Boat Sector
72
..
..
..
.
.
...
*..*
........
......
Detailed Cost Estimate.
73
.................
Estimated Scheduleof Credit Disbursement
74
Scheduleof Project Implementation
Terms of Reference for Project Design and
75
CoordinationConsultants.
87
Terms of Reference for BIWTC ManagementConsultants
91
ProjectMonitoringand SupervisionIndicators
94
Project MonitoringUnit Responsibilities...
BIVTA FinancialPerformance............................... 95
BIWTC FinancialPerformance...............................105
115
...............-.......
.....
Economic Evaluation
SelectedDocuments and Data Available in the Project File. 131
CHARTS
Chart 1: OrganizationChart - Ministry of Shipping
Chart 2: OrganizationChart - BangladeshInland Water TransportAuthority
MAPS
IBRD Hip No. 22359: Bangladesh- TransportNetwork Flows
IBRD Map No. 22007: Bangladesh- Inland Waterway System
BANGLADESS
THIRDINLANDWATER
TRANSPORT
PROJECT
STAFFAPPRAISALREPORT
I. THE TRANSPORTSECTOR
1.01
Bangladesh,
for the most part,is comprisedof a flatalluvialplain
crisscrossed
by ..largenumberof riversand watercoursesincluding
someof the
world'slargestriverssuchas the Ganges/Padma,
the Brahmaputra,Jamuna
and the
Meghna. The countrybeing extremelyflat and low-lying,all three modes of
surface transport,road, railway and inland wtter transport (IWT) play
significant
rolesin the transport
of bothpassengers
and cargo. Thisis evident
fromTable 1.1 below,which presentsrecentdata for transportoutputand the
sharesof the threesurfacetransport
modes. The relativerolesof the transport
modesare evolving,
withroadtransport
expanding
at the expenseof railways,
and
inlandwatertransport
reasserting
its inherent
costadvantages
throughincreased
mechanization.IDA has embarkedon a major reviewof the transportsector,
to assessrecentdevelopments,
and to improvecoordination
of sectorInvestments.
The followingsummarizessome key characteristics,
problemsand the current
situationfor eachof the threemain transport
modes.
Table1.1: MODAL SNARS IN PASSENGER
AND PREIGHTTRANSPORT
Total
Pass-Km
Estimatedfor 1985
Passenger
Mode Shares
Road Water Rail
35 billion 642
162
202
Total
Ton-Km
Freight
Mode Shares
Road Water Rail
4.8 billion 482
352
172
SourcessSee Annex1, Table1.
A. The ThreeSurface Truasport Mdes
1.02
Road transportis the most dynamicareaof transportdevelopment.The
paved road networkhas expandedfroma mere 600 km in 1947 to around6,600km
today. Freightvolumecarriedby roadtransport
has increased
by over50 percent
duringthe 19809fromaround11 milliontonsin 1981 to over 17 milliontons in
1988. Similarly,
passengervolumeshavealso increasedfromarnund130 million
passengers
in 1981 to over210 millionpassengersin 1988. The marketshareof
road transportin the higher value commodities,particularlythose whose
distribution
is not controlledby the Government,
has been increasingat the
expenseof the railways.The primaryreasonsfor the successof roadtransport
have been improvements
in the road networkand the betterqualityof service
providedby the largelyprivatetruckingindustry.However,road transportis
likelyto be constrained
by the high cost of developingand maintainingan
extensivehighwaynetwork in Bangladesh. The numerousand shiftingriver
1/ Bangladesh
TransportSectorStudy,fundedby the UnitedNationsDevelopment
Program(UNDP)and beingcarriedout by the WorldBankas executingagency.
-2courses, periodic flooding and lack of construction
materials
result in high
investment costs for permanent river crossings
and embankments, and high
operating costs due to the need for ferries.
1.03
Inland waterways are a critical
component of the Bangladesh transport
system in view of the floods which regularly affect the country and disrupt the
other two surface transport modes. The inland waterway network comprises over
8,300 km of navigable waterways during the monsoon season; this reduces to about
5,200 km during the dry season. More than half of the country's total land area
is situated within a distance of 10 km of a navigable waterway. This network of
tonnage and a large
waterways carries
about a third of- _ne total freight
A major problem
proportion of the passengers transpoi .4dwithin the country.
affecting inland water transport
is the shrinking of the navigable network due
to both siltation
and reduction in the amount of water available during the dry
season. The inland waterway system includes some eight major ports and numerous
(over 100) lesser ports.
Operations at these ports are impaired by inadequate
for storage, and
facilities
for mooring and unloading vessels, lack of facilities
siltation
in approach channels; the problems are compounded by the unpredictable
nature of the rivers which often change course, erode embankments, and in general
A more detailed
infrastructure.
pose risks for investments in fixed riverfront
discussion of the IWT system is provided in Chapter It.
1.04
Bangladesh Railways (BR) operates a network of around 2,800 roufekm of
which some 900 route km are broad gauge located in the western p&rn . the
Th.'s inherent weakness
The remainder of the network is meter-gauge.
country.
of the original network created by the
in the rail network stems from partition
British in India; the concept then was to establish a core broad gauge network
In 1947, what is now Bangladesh
with a meter gauge network on the periphery.
inherited a part of the core broad gauge netwoxk; however, these broad gauge
lines were cut off from their main ttaffic
generating centers including the Port
of Calcutta.
In addition to this mix of gauges, the rail network suffers from
the difficulties
of the trans-Jamuna ferry crossings
(at Bahadurabad and
Jagannathganj),
closures due to floods, and poor mwanagement. Traffic on the
during the 19806, from 90 million passengers
railways has declined substantially
and around 3 million tons of freight in 1981 to about 50 million passengers and
about 2.4 million tons of freight today.
The most important issue at present
with regard to BR is the high level of direct and indirect subsidies provided by
the Government; BR revenues currently cover less than 70 percent of its operating
costs. The situation has been worsening, with BR share of traffic declining and
its costs increasing, and it is unclear whatcan be done to reverse this trend.
The single biggest question regarding future transport strategy relates to the
future role of the railways.
B.
Sector OrMnitation
1.05
Development responsibility
for the transport sector is divided between
the Ministry of Coummunications (railways and mainroad network), the Ministry of
Shippitg (inland water transport,
ports and shipping), and the Ministry of Local
Coordination of sector development strategy has, to
Government (rural roads).
the extent this actually
takes place, been exercised by the Infrastructure
Division of the Planning Codmission. Private sector involvement in transport in
Bangladesh is extensive with the exception of two areast rail transport and the
The latter are operated by two public agencies, the Roadsand
vehicular ferries.
HighwaysDepartment (RHD) for the smaller vehicle ferries numbering around 70,
-3.
and the BangladeshInland Water Transport Corporationwhich is responsiblefor
threemajor ferry operations(Aricba-Daulatdia-Nagarbari,
the SirajganjFerry and
the Mawa Ferry). In road transport,the public sector BangladeshRoad Transport
Corporationcarries less than 10 percent of total traffic. The Governmentowned
BIWTC's role in inland water transport amounts to 24 percent of the freight
market and 9 percent of the passengermarket. It is generallyacceptedthat the
private sector involved in transport in Bangladeshhas been competitive and
dynamic,but suffers from an inabilityto undertake large investments.
C. Sector Financing
1.06
Resources flowing to transport and their allocationamong transport
modes, have undergonesome major changes during the 1980s (detailsare provided
in Annex 1, Table 10). Developmentexpendituresfor transportfell substantially
in mid-decadeand have only partially recoveredeither as a percentageof total
developmentexpendituresor in absoluteterms (In 1988189transportdevelopment
expenditureswere 76 percent of 1980/81 levels in real terms). During this
period, the main shiftswithin the transportsector were in favor of roads, the
share of which increasedfrom around 35 percent to over 45 percent. Development
expenditures in the transport sector are increasinglydependent on external
assistance. Project aid as a proportion of total development expenditures
increased from around 35 percent in 1980-81 to over 65 percent in 1988-89.
Recurrentexpendituresfor transport,however, have increasedconsiderably;in
line with the rise in total recurrentexpenditures. The allocationof recurrent
expendituresamong modes shifted in favor of roads recently (from around 25
percent in 1985/86 to 33 percent in 1987/88), and this is partially the result
of IDA's Road Rehabilitationand Maintenance Project (Credit 1827-BD) which
requireda substantialincreasein maintenanceallocationsfor the road sector.
D. IDA'. Sector Role and Assistance Strateagy
1.07
Since the creation of Bangladesh, IDA has maintained a continuing
presence in the transport sector in Bangladesh,concentratingprimarily in the
areas of highway development,rural road infrastructureand the inland water
transport sector. The Association'sdialoguewith the Governmenton transport
sector issueshas been extensive,particularlyin respect of the proposedJamuna
Multipurpose Bridge Project now being processed. IDA and the Government of
Bangladesh(GOB'have also embarkedon a UNDP-fundedTransportSector Study (para
1.01), which among other things, will serve to strengthen the Government's
capacity for planning and coordinationof transport investments through the
establisbmentof an Inter-Ministerial
SteeringCommitteefor Transport (IMSCT).
The IMSCT would provide a means for the Governmentto formulatetransportsector
policies/objectives
for each transportsubsectorthat are consistentwith overall
developmentobjectives.
Previous IDA Operations
1.08
In the inland water transport sector, IDA has financed two relatively
minor operations. The InlandWater TransportRehabilitationProject (Credit424BD, approved August 1973, PPAR No. 4026, June 1982) financed spare parts and
equipmentneeded for rehabilitationof some vessels and modificationsand repair
of the offshoreoil terminalat Chittagong. The projectwas completedbut with
-considerable
delay. The delaywas mainly the result of procurementdifficulties.
-4The Second Inland Water Transport (Credit735-BD, approvedJuly 1977, PPAR No.
5778, June 1985) was primarily intended to prepare a medium-term investment
program for the sector. Various studies carried out under the second project
contzibutedto the preparationof this proposedproject.
1.09
In the transport sector generally, IDA has financed the Fertilizer
Transport Project (Credit 1096-BD, approved January 1981, closed FY87) which
includedcomponentsfor BIWTA, BR, and the ChittagongPort Authority. The rail
component faced the greatest difficultyprimarily in the area of procurement.
IDA is also assisting in the development of Bangladesh's main seaport at
Chittagong (Credit1247-BD,approvedMay 1982, ongoing)and this project too has
been characterizedby delays in procurementand contractordifficulties. In the
roads subsector, following two major highway operations which constructed
segments of the Dhaka-ChittagongHighway (Credits408-BD and 964-BD, approved
June 1973 and May 1982, respectively,combinedPPAR No. 7954, June 1989), several
other projectswere not pursuedbecause of disagreementsconcerningGovernment's
commitmentto maintenanceof the road network. In 1984, the Governaentrequested
IDA to assist with rehabilitation of the road network, and the Road
Rehabilitationand MaintenancePv%lect (Credit1827-BD,June 1987, ongoing)was
initiatedto rehabilitateor carry out ajor maintenanceon about 660 km of roads
in the 16 new zilas of the NorthwestDivision,prepare a road master plan, and
develop an action plan to strengthenthe -'ostructionindustry. IDA is also
financingthe Rural Roads and Markets Improve *ntand MaintenanceProject (Credit
1940-BD,June 1988, ongoing). Two agricultureRural DevelopmentProjects(Credit
631-BD, May 1976, closed FY84, and Credit 1384-BD,June 1983, closed FY90) also
cont.ined rural roads components. IDA is p-,,essing the proposed Jamuna
MultipurposeBridge Project,which would be the ? it fixed crossingbetween the
eastern and western halves of the country,on the-b&sisof a UNDP-financedWorld
Bank-executedfeasibilitystudy (November1989), and is also preparinga Second
Road Rehabilitationand MaintenanceProject.
1.10
SeveralIDA operationshave assistedBangladeshto rebuildafter natural
disasters and have included componentsfor the transport sector. The Coastal
Area Rehabilitationand Cyclone Protection Project (Credit ?39-BD of FY73)
followedthe 1970 cyclone,and the Flood RehabilitationProject (Credit1587-BD,
of FY85) responded to the floods of 1984. The Second Flood Rehabilitation
Project (Credit1876-BD of FY88) rehabilitated1987 flood damages. It included
replac,mentof navigationalaids, repair of jettiesand a tugboat. Followingthe
1988 flood, which was even more severe than the 1987 flood, IDA approved the
Third Flood RehabilitationProject (Credit2048-BDof FY89)which includedabout
US$14 million for the IWT sector. These emergency projects have generally
disbursed satisfactorily.
ProJect Sustainability
1.11
Previous experience in Bangladesh indicates that sustainabilityof
physicalinvestmentsis fairly good, when viewed from the limitedperspectiveof
economic return on investments,and this is despite considerable delays in
implementation. The most difficult areas have been technical assistance
componentsand institutionaldevelopment. In both areas, projects have faced
considerabledifficultiesin implementation,and when implemented,in utilizing
tne results. Problemsprimarily arose in procurementof professionalser-tces
which always require time consuming high level decisions. In retrospect,
implementationproblems might have been better addressed through a permanent
-5project zoordinationunit at the ministry level, particularlywhen a project
involvesmultiple agencies.
Rational, for IDA Involveuent
1.12
Since IDA's two projects in the 1970s, IWT agencies have relied
extensivelyon fragmentedsupport from various bilateraldonorswhose relatively
constrainedresourceshave naturallyrestrictedthe scope and durat.onof their
activities. As a result, no comprehensiveeffort has evolved to develop the
inlandwaterwaysof Bangladesh. Dredgingoperations,for instance,have actually
declined to about half the levels achieved in the early- to mid-19809. The
proposedproject is includedin the draft Country StrategyPaper for Bangladesh
and in the Government'sThree-YearRollingPlan (PriorityInvestmentProgram)for
FY91-93. IDA's involvementin this project,and in the processof developingthe
core investmentrprogramfor IWT, will address some of the more immediateneeds,
including policy reform and institutionalstrengthening,in this important
transport subsector.
II. INLAND WATER TRANSPORT
2.01
Recent forecastsfor 1995 of IWT modal share are presented in Annex 1,
Table 1, and these range from 15 percent to 24 percent of passenger and 30
percent to 37 percent of freight transportdemand. Clearly,IWT will continue
to play a significantrole in both passengerand freightmovements. Applyingthe
lowest forecastsfor both total transportoutput and lIWTmode share produces IWT
output levels in 1995 which are higher than at present:IWT passenger-kilometers
increasefrom around 5.6 billionpass-km to at least 6.3 billion pass-km in 1995
(i.e., 2 percent growth p.a.); and IWT ton-kilometersincreasefrom around 1.7
billion ton-km to at least 2.2 billion ton-km over the same period (i.e., 5
percent growth p.a.).
2.02
IWT tends to play a larger role in the south and southwestof Bangladesh
as would be expectedgiven the estuarinenature of this part of the country. The
south and southwestare also among the poorer regions of the countryand are the
areas most subject to natural disasters from floods and cyclones, and therefore
the least friendlyenvironmentfor the other transportmodes. The map attached
(IBRD Map No. 22359) she,- the distributionof passenger and commodity flows
indicatingthat a large proportionof transportneeds in the south and southwest
are met by IWT. The followingsectionssummarizethe role and performanceof the
IWT system and details are provided in Annex 1.
2.03
The IWT system in Bangladeshis both extensiveand well-connectedwith
the rest of the transportsystem. This is clear from comparisonswith a country
such as China which is one of the more intensiveusers of MT in Asia (Annex 1,
Table 2). In terms of traffic intensity,Bangladesh'sinland waterway network
generatesabout 2.3 million passenger-kilometers
and 670 thousandton-kilometers
per route-kilometerof waterway,whh.lefor China, equivalentfigures are 140,000
passenger-kilometers
and 1.9 million ton-kilometersper route-kilometer. The
important difference is the much higher reliance on waterways for passenger
transportin Bangladeshthan in China. The densityof inland ports and terminals
is much higher on the Bangladesh waterways with approximately6 berthing
facilitiesper 100 route-kilometers
versus on average 1 facilityper 100 routekilometersin China. The densityof passengerfacilitieson Bangladeshwaterways
is also high at around 60 per 100 route-kilometers.
-6-
A. Performace of Inlad Water Transport
2.04
Despite this favorable environment for waterway development, the
performanceof inlandwater transportin Bangladeshis poor by almost any measure
of systemperformance. Annex 1 (Table3) providescomparatorsfor Bangladeshand
the Chaugjiang (Yangtze)waterway system in China on a few key productivity
measuces. The data highlight the low level of utilization of IWT assett in
Bangladesh. Low levels of capital asset utilizationin the cargo sector (tonkmlton of capacity)primarilyrssultsfrom the existenceof a substantial -urplus
in the inland cargo fleet. This situationhas developedpartly as a result of
misguided investmentincentivesin the past, but also as a result of inadequate
enforcementof constructionand vessel condition requirements. It is estimated
that cargo vessels in the inland fleet now spend on average around 200 days per
year awaiting
repairs,
awaiting
berth space ox idle. It is estimatedthat the
nonproductivetime of these vessels could progressivelybe reducedto around 120
days per year on average. In waterwaymaintenance operations,&.redgingoutput
(cubic meters per dredge per year) of the Baagl%desh Inland Water Transport
Authority (BIWTo)dredge fleet is around a third of that achievedunder .imilar
conditionselsewhere. Partly, this is due to an excess of dredge capacity,and
partly to inadequateoperatingproceduresand funding.
2.05
Perhaps the most critical area of poor performanceof the Bangladesh
inland water transport sector relates to vessel safety. Over the five-year
period 1984-88 for v,ich data is available,therewere 56 major passengervessel
accidents,which is a rate of almost one such incident per month. About 40
percentof accidentsare caused by overloadingof vesselsresultingin capsizing.
These overloading accidents, which are entirely preventable (as much of it
results from poor policy, e.g., low tariffs),are extremely costly in loss of
lives. Another 40 percent of accidents are collisions which are caused by
inadequaciesin navigationalmarks and incqmpetencyof vessel creus. Only 20
percent of the accidents were caused by natural phenomena. Data on overall
fatalities are unreliable, however considering that each vessel carries on
average about 150 passengers,the total loss of life in these accidentscould be
well over 1,000 each year.
D. Institutional
Frmework
2.06
The MW'.nistry
of Shipping (KOS) is responsible for all Government
functions in the inland water transport sector.
It discharges these
responsibilitiesthrough three agencies namely the Bangladesh Inland Water
TransportAuthority (BIWTA),the BangladeshInland Water Transport Corporation
(BIWTC),and the Departmentof Shipping (DOS). The first two are autonomous
entities which are expected to be self-financing. BIWTA is responsible for
maintaining all waterway infrastructureincluding channels, inland ports and
other public facilities. BIWTC operates a fleet of vessels engaged in ferry
services, inland and coastal cargo services, and inland and coastal passenger
services. DOS is responsiblefor most regulatoryand trainingfunctions,though
in some areas, its mandate appears to overlap with that of BIWTA.
2.07
Institutionalcapacityin the IWT sector appearsto have weakenedin the
mid- to late-1980s. Planning and data collection activities,which are an
important element of BIWTA's activities,,
do not receive adequate attention.
Training capabilities,especially of deck personnel who are critical to safe
vessel operation,also need to be enhanced. Currently, BIWTA is mandated to
of maximumand
regulatebothpassengerand freighttariffsthroughestabliabment
(calledthe
minimumtariffs. In practice,only a singletariffis established
of distance)
maximumtariff)and a minimumcharge(minimumchargeirrespective
is set. As a result,tariffsin the sectorare fixedat low levelsthereby
operatorsto overloadvessels. BothBIWTAand BIWC sufferfromlow
encouraging
high cost of operationsand poor revenuegeneration.
efficiency,
operational
wouldbe addressedunder the proposedproject.
Theseweaknesses
and Strategy
Objectives
C. Development
with donor agenciesworking in the InT
Government,in collaboration
2.08
for IWT under
objectives
development
sector,has set out short-to medium-term
the FourthFive-YearPlan (FY91-FY95).The objectivesand the Government's
strategyfor attainingtheseare:
major emphasisin Improving
2.09
ImproveVesselSafety: The Government's
and in general,the enforcement
of overloading,
vesselsafetyis the prevention
of safety regulations. This will also require improvedpassengertariff
and encouragesinvestmentin passenger
regulationthat is less restrictive
intendsto providebettertrainingfor
Government
capacity.Secondly,
transport
inlandvesseloperatorsand improvedsafetysystemson the waterways,including
among
night navigationaids on heavilytraffickedroutes,raiiocomuunication
and safe
properchartingandmarkingof waterways,
vesselsand to shorestations,
passengerlandingfacilities.
will
EnsureAdequateInlandPassengerTransportCapacitys Government
2.10
bothsidesof the
by addressing
situation
seekto improvethe currentoverloading
capacityequation:demandand supply. Tariffsfor passengertransportare
whichwould
deregulated
currentlyset at low levels,and are to be progressively
resultin some price increases. This is expectedto both reduce passenger
in vesselstherebyincreasing
investment
demandand attractadditional
transport
fleetcapacity.
would
of regulations
Enforcement
2.11
ImproveCapitalAsset Utilization:
to scrapor otherwiseremoveobsoletecargovesselsfromthe
forcemanyoperators
of the remaining
improvetheproductivity
activefleet. Thiswillsimultaneously
of improvedshorefacilities
fleetand enhanceitsphysicalcondition.Provision
will also improve fleet utilization. In waterwaymaintenanceoparations,
utilizationof dredging assets will be improved through improvementsin
of dredging
operationalpractices(e.g.three shiftworking),consolidation
provision
and
through
BIWA,
Unit
within
Drodging
under
a
single
responsibilities
enhancements.
tied
to
productivity
of adequateoperatingfunds
in freighttransport
Costson IWT: Reductions
ReduceFreightTransport
2.12
and producti'tty
reductions
fleet
through
primarily
be
achieved
costs wili
enhancementsoutlinedabove. Additionalcost savingsare availablethrough
in channelconditionsand at inlandports on the main IWT routes
improvements
and Dhaka to Chattak in the
(Dhakato Chittagong,Dhaka to Khulna/Mongla,
northeast).Theseroutesaccountfor around80 percentof outputin the formal
night
will seekto improvenavigation(particularly
IWT sector. The Government
and channelconditionson these routesto allow the use of more
navigation)
to receivethe benefitof these
vessels).For shippers
efficienttonnage(larger
freighttariffsin the sector.
will alsoderegu',ate
the Government
.aprovements,
-82.13
Encourage Development of Country Boat Sector: Country boats in
Bangladesh perform almost as well and sometimes better than the 'modern'
mechanized inland fleet (Annex 1, Table 3), and considev' g their very
significant role in the rural areas of Bangladesh particularlywith regard
employment of the rural poor, the Government is encouraging their increased
participationin inland water transport. Currently, there are around 20,000
larger country boats (above 5.5 tons capacity)engaged in cargo transport,and
around 160,000 smaller boats used for passengeran
rgo transport. At least
10 percent of this fleet is now mechanizedwith the productivity(ton-kmoutput)
enhancementsfrom mect-.Z'-7.ation
ranging from a factor of 2.0 to 2.5. While
transportcost saving,f ros%iechanization
are not substantial,mechanizedvessels
provide more reliab
be. ice and increased safety due to their improved
maneuverabilityand X-i-e
For these reasons, the Governmentwould encourage
improvementsin this sector. The Government'sstrategy includesmeasures such
as providing infrastructureand facilitiesfor technicalextension services.
2.14
Improve Financesof BIWTC: Improvingthe financialviability of BIWTC
is a key objective of the Government. This can be achievedby rationalization
of its operations (particularlyin the cargo sector which suffers by far the
largest losses) and reduced staffing, to be accomplishedthrough L program of
early retirement, and redeployment of surplus staff to other functional
responsibilitieswithin BIWTC or to other agencies involved in inland water
transport,e.g., to DOS for vessel inspections.
2.15
Improve InstitutionalCapacitys The Government recognizes that the
planning and policy formulation function at BIWTA needs to be strengthened
through expanding its staffingand through creation of an additionalMember of
the Board responsible for planning and operations. Environmentaland safety
issues will be better addressedthrough establishmentof an Inland Ship Safety
Administrationwithin DOS. Trainingcapabilitieswill be consolidatedunder DOS,
and will be strengthenedthroughupgradingof the Inland Deck PersonnelTraining
Center.
D.
Public
Expenditure for IWland Water Transport
2.16
The share of water transportin overall
public expenditures
(Annex 1,
Table 10) appears to have remained fairly steady at around 30 percent of
transportdevelopmentexpendituresand around 10-12percentof transport-related
revenuebudget expenditures.Developmentbudget allocationsfor water transport
are, however,misleadingbecause they includeallocationsfor the developmentof
the main seaportsof Chittagongand Mongla. Adjustingfor this, the inlandwater
transport sector allocationin the developmentbudget reduces to less than 10
percent, which corresponds with the allocation in the revenue budget (the
seaports produce operating surpluses and are not dependent on the revenue
budget).
2.17
Within the contextof projectedresourceconstraints,the Governmenthas
prepared a prioritized investmentprogram for the IWT sector, with a view to
ensuringthat core elementsreceivepriorityattention. Investmentneeds of the
IWT sector have been identifiedfor five areas of the inland water transport
secto-: (a) vessel safety (US$11 million); (b) waterway development (US$22
million); (c) inland ports and passenger facilities(US$43million); (d) inland
fleets (US$67 million); and (e) institutionaldevelopment (US$10 million),
totallingUS$153 million. This total level of public investmentis much higher
-9than the expected availabilityof domestic and external resources during the
Fourth Plan period. The overall program has thereforebeen ranked into a core
program (US$55 million)and PriorityI investments(US$62million) and Priority
II investments (US$35 million). The Priority InvestmentProgram is shown in
Annex 2, and details are in the project files.
2.18
Based on the above core program,PriorityI developmentexpenditures,
and estimated maintenance
expendituresfor IWT, less increased revenues from
increasesin BIWTA and BIWTC tariffs,projectionsfor total Fourth Plan outlays
for the IWT sector have been prepared. Table 2.1 relates these projectionsto
overallprojectionsfor the Annual DevelopmentPlan (ADP)and the Revenue Budget
over the Fourth Plan period. The projectionsfor ADP and the Revenue Budget
assume a 3.5 percent growth in these budgets from planned FY91 levels, and this
is in line with IDA estimatesof future GDP growth. On the assumptionthat IWT
receives1.2 percentof overallallocations(10percentof transportallocations,
and transport receives 12 percent of the total which corresponds to historic
levels), the projected outlays are well within historic levels for both the
developmentbudget and the revenue budget.
Table 2.1s TOTAL PUBLIC RESOURCESAND IRT OUTLAYS FOR TME FOURTH PLAN PERIOD
(ConstantPY90 Tak in Millions)
FY91
Forecast Total ADP
FY92
FY93
FY94
FY95
Total
56,700 58,700 60,700 62,900 65,100 304,100
IWT DevelopmentBudget a/
400
500
600
750
900
3,150
2 of Total ADP
0.7
0.9
1.0
1.2
1.4
1.1
Forecast Total Revenue Budget 73,000 75,600 75,800 78,500 81,200 384,100
IWT RecurrentAllocationb/
250
310
370
430
490
1,850
2 of Total Revenue Budget
0.3
0.4
0.5
0.6
0.6
0.5
a/
b/
Estimated DevelopmentBudget for Core Program and Priority I investments.
Estimatedmaintenanceexpendituresless BIWTA and BIWTC revenues.
III. THE PROJECT
3.01
The proposed Third Inland Water TransportProject (IWT-11) comprises
various componentsintended to address some of the key problems the Government
faces in the IWT sector,and would support the core program of the Government's
Priority InvestmentProgram for the sector. The projict focuses primarily on
developmentof the waterwaysystem in the south-westand north-eastof Bangladesh
as shown in the attachedmap (IBRDMap No. 22007).
-10-
A. ProJectOrigin
3.02
The projectgrew out of a realization
that IWT was criticalto the
countryespeciallyduring floods,that safetystandardswere poor, that the
infrastructure
was rapidlydeteriorating
as a resultof past neglect,and that
a numberof policiesand practicesin the sectorwereexacerbating
the situation.
As partof preparation,
a MasterPlan for the IWT sectorhas beenpreparedwith
technicalassistancefrom the Netherlands.In addition,IDA has executeda
numberof studiesfundedby the UnitedStatesTradeand Development
Programin
1989on vesselsafety,dredging,
navigation
aids,hydrographic
surveys,training
and institutional
development.IDA has alsoexecuteda studyof the BIWTCfleet
fundedby the UnitedKingdomDepartment
of Tradeand IndustryTrustFund. Based
on these,theGovernment
has formulated
the Priority
Investment
Program(PIP)for
the IWT sectorwhichwill constitute
the FourthFive-Year
Plan (4FYP,1991-1995)
for thissector.In addition,
projectpreparation
has emphasized
preparation
and
agreementon a numberof policypapersand development
strategies
whichunderpin
the projectconcept. Theseinclude: a Strategic
Plan for BIWTC,an Operations
Improvement
ActionPlan for BIWTA,Institutional
Development
ActionPlansfor
DOS, BIWTAand BIWTC,and FinancialRecoveryActionPlansfor BIWTAand BIWTC.
B. ObJectives
3.03
By financing
the coreprogramfor IWT,the projectwouldseekto ensure
that the Governmentcan address the essentialelementsof its development
strategy. The objectivesof this developmentstrategyares (a) improving
waterway safetyand environmental
controls;(b) increasinginlandpassenger
transport
capacity;(c)improving
capitalassetutilization;
(d) reducinginland
water freighttransportcosts; (e) improvingcountryboat operations;(f)
improvingthe financesof BIWTA and BIWTC; and (g) improvinginstitutional
capacity for planning,policy formulationand training of inland vessel
operators.
C. ProjectDescription
3.04
Thevariouscomponents
of the projecthavebeengroupedintofiveparts,
as follows:
PartA: DredginM(BIWTA- US$3.0million)
3.05
Selected
waterways
wouldbe deepened
as neededto ensurethat1.8meters
of water are availableat all seasons. Dredgingworks totalling10 millionmO
wouldbe carriedout by forceaccountat a rateof about2 millionm9/yearusing
BIWTA'sdredgesas followss (a) 2 millionm9 at the Ajmiriganjsectionof the
Meghna-Kushiyara
River;(b) 1.3 millionma at the Baulaisectionof the Kangsa
River; (c) 1.7 million ma in the Titas River; and (d) 5 million mP for
rehabilitation
of certainpatchesof ClassI and ClassII waterways,V
including
accessto BaghabariPort. The projectwouldfinancepartof the costof dredging
21 'ClassI Waterway"means a waterwaywith a minimumnavigabledepthof 12
feet; and 'ClassII Waterway'means a waterwaywith a minimumnavigable
depthof 6 feet.
-11-
operations based on fuel and repair expenses.
IDA has considered the
internationalaspects of this component,in particular,dredgingon the Meghna
River. Althoughthis is an international
waterway,the works proposedunder this
projectwould not adverselyaffect the quantityand qualityof water flows to any
ripariancountries. Similarly,the works would not be adverselyaffectedby the
use of water that ripariancountriesmight make.
Part B: Aids to Navigation (BIWTA - US$6.8 million)
3.06
Aids to navigationon about 1,200 km of Class I and Class II waterways
will be upgraded to secure day and night navigationby rehabilitatingexisting
equipment and providingnew floatingand shore lights,buoys, beacons,etc., as
well as replacementof about 75 percent of acetylene powered lights with solar
powered lights. This would mainly involveprocurementand installationof about
400 shore lights, 50 lighted buoys and 100 unlighted buoys. Waterways to be
upgraded are: (a) all Class I and Class II waterways; (b) proposed Class II
waterway from Bhairabazar to Chattak; (c) waterway approaches to Mongla and
Bhuapur-Sirajganj,
and
Chittagongseaports;and (d) Aricha-Daulatdia-Nagarbari,
Mawa ferry routes.
Part C: Inland Pontoon Facilities (BIWTA - US$7.5 million)
3.07
Presently, there are about 1,400 landing stations at which launches
handle passengers and cargo. Of these, only about 230 have pontoons to
facilitatepassengerand cargomovements. An additional100 pontoons,including
five spare pontoons to replace those being maintained or repaired, and their
access bridges would be provided under the project at selected locations
conformingto the pontoon locationcriteriaagreed with Government (Annex 3).
Part D: Equipment (US$19.1million)
3.08
The project includes numerous smaller components as follows: (a)
procurementof equipment for rehabilitationof 5 BIWTA 18-inch cutter suction
dredgersincludingfuel monitoringsystems (Annex 4, para 2); (b) procurementof
spareparts (Annex4, para 3) and floatingsupportequipmentfor BIWTA'sdredgers
(Annex 4, para 4); (c) purchase and installationof equipmentto upgrade BIWTA
and BIWTC's High Frequency (HF) telecommunicationsystem (Annex 4, para 12 and
Annex 5, para 34) and establishmentof distress frequencymonitoringat Dhaka,
Mongla and Chittagong (Annex 4, para 13); (d) purchase of inland survey work
boats and accommodationbarges for BIWTA survey crews (Annex 4, para 19); (e)
procurementand installationof an electronicpositionfixing system to replace
BIWTA'sexistingDecca system (Annex4, para 19); (f) rehabilitationof selected
BIWTC vessels within the overall parametersestablishedfor the BIWTC fleet in
the StrategicPlan (Annex5, para 31); (g) procurementof miscellaneousequipment
and facilitiesfor BIWTC including fuel monitoring systems (Annex 5, para 34);
(h) purchaseof 6 speed boats to DOS for safety patrols (Annex 6, para 17); (i)
purchaseof equipment for strengtheningthe DOS Inland Deck PersonnelTraining
Center (Annex 6, para 19); (j) purchase of equipment for DOS for environmental
control (Annex 7); and (k) purchaseof equipmentand facilitiesfor countryboat
owners associationsto be establishedby BIVTA (Annex 8).
Part Es TechnicalAssistance (US$6.5million)
3.09
The following technical assistancecomponentswoild also be financed
under the project: (a) implementationof BIWTA Operationu ImprovementAction
-12Plar. (Annex 4); (b) management consultancy to implement the agreed BIWTC
Strategic Plan (Annex 5); (c) project design and coordinationsupport for the
ProjectMonitoringUnit of MOS (paras3.17 and 3.18); (d)establishmentof Inland
Ship Safety Administrationwithin DOS (Annex6, pares 15-18); (e)preparationfor
DOS of an environmental mapping of the waterways (Annex 7, para 2) and
developmentof implementingregulationsfor environmentalprotectionof inland
waterways (Annex7, para 4); and (f) assistanceto DOS to developthe Inland Deck
Personnel Training Center (Annex 6, para 19). Total work months of technical
assistancerequired is estimated at about 410.
D. Cost Estimates
3.10
The total cost of the project, including contingencies,taxes and
customs duties is estimated at US$64.2 million equivalent, of which US$47.2
million equivalent(73.5percent)is the estimatedforeigncost component. Taxes
and duties would amount to US$8.8 million equivalent. A summary of the cost
estimate is given below and details are in Annex 9.
Table 3.1:
SUMMARYOF PROJICT COST ESTIMATE
Percentage of
Tk million a/
US$ million al
Total to
Local Foreign Total Local Foreign Total Base Cost
Dredging b/
--
102.7
102.7
--
3.0
3.0
7.0
Aids to Navigation
47.9
184.8
232.7
1.4
5.4
6.8
15.8
Inland Pontoons
68.5
188.2
256.7
2.0
5.5
7.5
17.5
Equipment
65.0
588.6
653.6
1.9
17.2
19.1
44.5
Project Support-TA
13.7
68.4
82.1
0.4
2.0
2.4
5.6
Capacity Building-TA
20.5
119.8
140.3
0.6
3.5
4.1
9.6
215.6 1,252.5 1,468.1
6.3
36.6
42.9
100.0
TechnicalAssistancet
Base Cost c/
Physical Contingencies
21.5
125.6
147.1
0.6
3.7
4.3
10.0
Price Contingencies
44.5
236.1
280.6
1.3
6.9
8.2
19.1
281.6 1,614.2 1,895.8
3.2
47.2
55.4
129.1
8.8
--
8.8
20.6
47.2
64.2
149.6
Project Cost
Taxes and Customs Duties 301.1
Total Project Cost
a/ US$1 - Tk.34.22
b/ By force account.
c/ At July 1990 prices.
--
301.1
582.7 1,614.2 2,196.9 17.0
-13Cost estimates for civil works and equipment reflect July 1990 prices
3.11
and the current exchange rate of US$1 - Tk 34.22. Thev are based on
internationalprices for similarworks and equipmentas well as recentlyexecuted
works in Bangladesh. Estimates for technicalassistanceare based on an average
of US$10,000 per work-month (expatriatetechnical assistance is estimated at
and local consultantsare estimatedat US$2,000per workUS$12,0001work-month
of 10 percent on averagehave been added. Price
contingencies
month). Physical
from 1990 to 1995, 4.3 percent for 1996
annually
percent
contingenciesare 4.9
project componentsand cost estimate
above
The
1999.
to
and 3.7 percent for 1997
Governmentand were confirmed at
the
with
upon
agreed
and
have been discussed
proiect proformasfor carrying
the
of
Government
the
by
Approval
negotiations.
out the proiectwill be a condition of effectivenessof this IDA Credit.
E. Financing and Disbursement
The IDA Credit of US$45 million equivalentwould finance: (a) all
3.12
foreign exchange costs of the project except for those technical assistance
componentswhich would be financedby a grant of US$5 million equivalentfrom the
FinnishInternationalDevelopmentAgency (FINNIDA),and the environmentalcontrol
components,which would be financed by a grant of US$0.7 million equivalent
providedby the Japan Grant Facility(JGF);and (b) 43 percentof the localcosts
excluding taxes and customs duties. IDA, FINNIDA and JGF contributionswould
thus cover 79 percent of the total project cost. The Governmentwould provide
the balance of the local costs (US$4.7million equivalent)and BIWTA, BIWTC, and
DOS will finance their respectiveshares of taxes and customs duties (totalling
US$8.8 million equivalent)out of their own budgets. Effectivenessof the grant
agreementbetween the Governmentof Banaladeshand Finland andthe Japanesegrant
agreementwill be conditionsof effectivenessof this IDA Credit. The financing
plan, includingtaxes and customs duties, would be as shown in Table 3.2t
Table 3.2: PROJECT FINANCINGPLAN
-- million equivalent
US$
Local a/
Foreign
BIWTA BIWTC DOS Total
GOB
IDA
Finland
Japan
IDA
3.8
Dredging
7.0
Aids to Navigation
7.1
Inland Pontoons
21.9
Equipment
TechnicalAssistance 1.7
0.3
0.4
41.5
0.7
Total
--
--
--
----
--
--
--
--
3.8
10.5
--
--
10.5
1.9
0.1
1.1
0.3
30.4
9.0
1.4
64.2
5.0
0.7
1.0
1.7
0.1
1.1
1.6
0.8
1.2
1.7
0.8
2.7
0.2
5.0
3.5
4.7
5.4
2.0
----
a/ Amounts shown for BIWTA, BIWTC, and DOS are taxes and duties.
In order to enable BIWTA and BIWTC to finance their respective
3.13
componentsof the project,the Governmentwill onlend to them US$35.5million and
US$11.4million equivalent,respectively,each for 25 years includingfive years
-14of grace, at 11.5 percent p.a. The executionof the subsidiaryloan sgreements
with the above two organizationswill be conditionsof Credit effectiveness.
Agreement
was reachedwith the Goveranent
thatit will includethe fundsfor DOS
componentsin its regularbudget allocationin accordancewith the agreed proiect
implementation schedule. The foreign exchange risk will be borne by the
Borrower.
3.14
Disbursementof the IDA Credit proceedswill be on the followingbasis:
(a) Dredgirg (para 3.05): 30 percent of the total cost. Using BIWTA
experienceand adjusting for anticipatedincreases in efficiency,the
approximatecost of dredging 10 million m3 is US$10 million of which
US$3.0 million is for fuel and repairs. The Design and Coordination
Consultantwill thus releaseUS$0.30 for each cubic meter certifiedas
dredged to cover the cost of fuel and repairs. Agreementwas reached
that the Governmentwill establishan organizationalunit for dredging
within BIWTA prior to use of any of the funds provided for dredging
under the Credit. This is a conditionof disbursement.
(b) NavigationAids and Inland Pontoons (para 3.06 and 3.07): 75 percent
of the total cost.
100 percent
(c) Equipment (para3.08): 100 percent of foreignexpend&.ture,
of local ex-factory expenditure, and 78 percent for other items
procured locally,except for the environmentalcortrol componentwhich
Agreement was reached that the
would be financed by the JGF.
Government would satisfactorily complete a study of alternative
electronic position fixing systems, in accordance with terms of
reference satisfactoryto the Association,prior to use of any of the
Credit proceeds for the procurement of such a system. This is a
conditionof disbursement.
(d) TechnicalAssistance (para 3.09 (f)]: 100 percent of the total cost.
Agreement was reached that the Inland Deck Personnel Training Centre
(DPTC) would be transferredfrom BIWTA to DOS prior to use of any of
the Credit proceeds for technical assistance to DPTC. This is a
conditionof disbursement.
Withdrawalapplicationsto IDA would be fully documentedwith contractdocuments
for works, goods and serviceseach costingUS$50,000or more. Reimbursementfor
expendituresrelated to dredgingworks under force account and contracts each
less than US$50,000 will be made against certified Statementsof Expenditure
(SOE). DocumentationsupportingSOEs need not be submittedto IDA but would be
retained in each project agency and the Project Monitoring Unit and made
available for review by IDA representativeson request. In order to facilitate
disbursements,a Special Account in US Dollars would be established in the
Central Bank of Bangladeshon terms and conditionssatisfactoryto IDA. The
initial deposit would be US$1.8 million equivalent representingan estimated
average of four months of project expenditures.The SpecialAccountwill be used
exclusivelyfor IDA's share of financing. Disbursementsfrom the SpecialAccount
will be for actual expendituresand these expendituresare to be authorizedby
the Project Coordinatoras head of the ProjectMonitoringUnit (para 3.17).
3.15
The proposed project would be the first comprehensive Bank Group
operationin the inlandwater transport subsectorin Bangladesh. Consequently,
-15historicaldisbursementdata from previous transportsector operationshas been
used to project disbursements. An eight-yeardisbursementscheduleis proposed
on this basis. The estimated scheduleof Credit disbursementis given in Annex
10. The project completion date is December 31, 1998, and the project would
close June 30, 1999.
F. Project ImPlementation
Tender documents for the main components have been reviewed by the
3.16
Govertment and IDA, and prequalificationof contractorsis scheduled for July
1991, tendering for October 1991, contract awards for March 1992, and project
completionfor late 1998. The scheduleof project implementationis detailedin
Annex 11, and was discussed and agreed at negotiations.
Project MonitoringUnit
The Governmenthas establisheda Project MonitoringUnit (PMU)within
3.17
MOS which will be responsiblefor coordinatingproject implementation.A Project
Coordinator,who will report directly to the Secretary, MOS, has also been
appointed. The PMU includes three full-time Deputy Project Coordinators
appointed in consultationwith the beneficiaryagencies,BIWTA, BIWTC and DOS,
each responsiblefor implementationof their respectiveprojectcomponents. Each
of the three agencieswill also appointa ProjectDirectorwithin the respective
agency. In addition, the PMU will be staffed with an adequate number of
qualifiedfull-timestaff to coordinateimplementationof the project,undertake
procurementactions,oversee implementationof action plans (para 4.08), handle
withdrawalapplicationsand prepareprogressreports. The PMU will be supported
in its work by the Design and CoordinationConsultant.
Design and CoordinationConsultant
Agreementwas reachedwith the Governmentduring negotiationsthat MOS
3.18
will appoint Design and CoordinationConsultants (financedby FINNIDA) to be
responsiblefor coordinatingvarious aspectsof the project,for implementingthe
BIWTA InstitutionalDevelopmentAction Plan and InlandShip SafetyAdministration
componentsof the project and for assistingthe ProjectCoordinatorin reviewing
designs and tender documents, organizing tender evaluations,ensuring timely
letting of contracts, monitoring progress and costs, and in controlling the
project budget. Detailed Terms of Reference for the Project Design and
CoordinationConsultantswere discussedand agreed,and are attachedas Annex 12.
The consultantswould be engagedunder terms and conditionssatisfactoryto IDA.
Appointmentof the ProjectDesign and CoordinationConsultantwill be a condition
of Credit effectiveness.
BIVTC Mana8ementConsultant
The GOB delegationconfirmed that the BIWTC will engage a Management
3.19
Consultant(financedby FINNIDA)to assist BIWTCmanagementin the implementation
of the BIWTC Strategic Plan. Detailed Terms of Reference for the BIWTC
Management Consultantwere discuased and agreed, and are attached as Annex 13.
BIWTC ManagementConsultantswill be engagedusing the same procedureas that for
the Design and CoordinationConsultants. Appointment of the BIWTC ManaRement
Consultantwill be a condition of Credit effectiveness.
-
16-
Implementationof Physical CoMponents
All physical componentsof the project would be implementedunder the
3.20
supervisionof the Design and CoordinationConsultants. The consultantwould
certify satisfactoryinstallationand testing of equipment. In the case of
dredgingworks, the consultantwould c_rtify pre- and post-dredgingsurveys and
would authorizewithdrawalrequestsof Credit proceedsat the rate of US$0.30per
cubic meter dredged. For the inland pontoons component, the Design and
CoordinationConsultantwould review pontoon sites proposed in respect of the
In supervising the
agreed "Criteria for Pontoon Locations* (Annex 3).
navigationalaids component,the consultantwould ensure that the contractor's
designs for marking of individualwaterways are adequatefrom a safety point of
view, meet relevant internationalstandards,and are cost effec ive.
Inland
Deck Personnel
Training
Centre
during negetiations the high priority it
The Government confirmed
3.21
the Inland Deck PersonnelTrainingCentre (DPTC),and
to strengthening
attaches
the need for expert assistancein designingand establishinga revised training
program which would be responsiveto the needs of the sector. However, the
Governmentwould like to explore the possibility of grant financing for this
component. If grant financingis secured by Credit effectiveness,the portion
of the Credit allocated to this component would be appropriatelyreallocated.
A decision on engaging the InternationalLabor Office (ILO) to provide expert
services will be made simultaneouslywith resolutionof the grant assistance
question; engagementof ILO for providing such serviceswould be acceptableto
IDA in view of ILO's extensiveexperiencein this field and previousinvolvement
in the DPTC.
Mid-Term Review of the ProJect
3.22
Agreement was reached with the Government during negotiationsthat a
review of the projectwill be carriedout within two years of the date of Credit
effectivenessbut no later than June 30, 1993. This review will be based on the
target indicatorsagreed and set out in Annex 14--"ProjectMonitoringand
variouis
SupervisionIndicators." These indicatorswill be revised during the review to
reflect actual accomplishmentsand revisedtargetswill be establishedto cover
the period to the end of the project. In preparationfor this review,the Design
and CoordinationConsultantwould draft briefingpapers on each of the project
components and the agreed action plans for circulationto the Governmentand
donors. These briefingpapers would cover the degree of achievementon various
performancetargets (Annex14), implementationstatus,problemsencountered,and
proposals for any changes in project scope, costs and timetables.
G. Supervisionand monitoring
3.23
The project would require 20 professionalweeks of IDA supervision
during each of the first two years, 30 weeks in year three (duringthe mid-term
review), and 15 weeks per year thereafter. The total requirement,including
preparation of the Project Completion Report, would come to about 145 staff
weeks. This supervision input would be required to review procurement and
paymentsin respectof a large number of smallcontractsand to ensure sufficient
attention to the early project experience so as to minimize the need for any
further restructuringfollowingreadjustmentsmade at the mid-term review.
-17H. Procurement
3.24
Procurementwould be carried out as follows:
Table 3.3: DISTRIBUTIONOF CREDIT PROCEZDS BY PiOCUREMENTMETHOD
Item
Dredging works
ICB
-------
LCB
--
--
Other
Total Cost
US$ million---------------3.8
3.8
(3.8)
(3.8)
Single responsibility
contracts for Aids-toNavigationand
Inland Pontoons
21.0
(15.8)
--
.-
21.0
(15.8)
Equipment
24.4
(17.6)
1.0
(1.0)
5.0
(5.0)
30.4
(23.6)
--
9.0
(1.8)
9.0
(1.8)
17.8
(10.6)
64.2
(45.0)
TechnicalAssistance
--
TOTAL
Note:
45.4
(33.4)
-
1.0
(1.0)
Figures in parenthesis are the amounts which will be financed by the
proposed IDA Credit. All figures iviclude
estimatedphysical ard price
contingencies.
3.25
Dredgingwould be carriedout by BIWTAunder force accountnot to exceed
an aggregateof US$3.8 million. Aids to navigationand inland pontoonsestimated
at US$21.0 million would be the subject of two single responsibilityturnkey
contractscoveringsupplyof materialsand equipment,construction,installation,
testingand 12 months maintenance. These contractswould b% awardedon the basis
of internationalcompetitivebidding (ICB) in accordancewith IDA's Guidelines
for Procurement. Individualpackagesvalued in excess of US$200,000equivalent
up to a total of US$24.4million of the equipmentwould be procuredby ICB under
several contracts depending upon the type of equipment to be purchased and
manufacturersspecialization.Each of these contractswould cover provisionof
equipment,installationand testing. Civil works not exceeding the equivalent
of US$50,000 each, up to an aggregate amount not to exceed US$1,000,000
equivalent, may be procured on the basis of competitive bidding advertised
locally,in accordancewith proceduressatisfactoryto IDA, provided,however,
that dredgingworks under Part A of the projectmay be carriedout through force
account. Goods estimated to cost the equivalent of US$200,000 or less per
contract,up to an aggregateamount not to exceed the equivalentof US$2,000,000,
may be procured under contracts awarded on the basis of competitivebidding,
advertisedlocally,in accordancewith proceduressatisfactoryto IDA. Items or
groups of items estimated to cost less than the equivalent of US$50,000 per
contract, '!p to an aggregate amount not to exceed that equivalent of
US$5,000,000,may be procuredunder contractsawarded on the basis of comparison
-18of price quotations solicited from a list of suppliers from at least three
differentcountriesellgibleunder the Guidelinesin accordancewith procedures
acceptableto IDA. Procurementdocumentationand decisionsrelatingto packages
valued in excess of US$500,000equivalentwould be subject to prior review by
IDA, and it is estimatedthat contractsfor 80 percent of the total Credit amount
would be subject to such review. Prequalificationof contractors would be
carried out for the contracts covering aids to navigation and pontoons.
Qualifyingdomestic contractorsfor such works will receive a preferencein the
bid evaluation of 7.5 percent of the total contract cost. Bids offering
domesticallymanufacturedgoods and equipmentwill receive a preferencein the
bid evaluationof the value of the applicableimport duty or 15 percent of the
c.i.f. price, whichever is lower. The above arrangementsas outlined in paras
3.24 and 3.25 were discuss d and agreed upon during negotiations.
I. Reporting
of the PMU, includingthe requirementfor reportingare
Responsibilities
3.26
given in Annex 15, and these were discussedand agreed upon during negotiations.
Reporting on the project will be reviewedperiodicallyand adjustmentsmade as
necessary. Upon completion of the project, the three beneficiary agencies,
BIWTA, BIWTC and DOS, will each prepare their respectiveparts of the Project
CompletionReport with the assistanceof the PMU. The Governmentwill retain the
PMU for a period of one year after the date of closing of the Credit.
IV.
INSTITUTIONALDBVELOPMWT
each of the three GOB agencies
implementation,
As part of project
4.01
actions to improve their
specific
undertake
(BIWTA, BIWTC and DOS) will
effectiveness. This sectionsummarizesthese institutionaldevelopmentactions,
and details are provided in Annex 6. Organizationalarrangementsof OS for the
IWT sector are shown in Chart 1.
A.
BangladeshInland Water TransportAuthority
BIWTA has the primarymission of developingthe water transportsystem;
4.02
its mandate however includeselements that are regulatoryin nature. The
Authority is managed by a Board consistingof a Chairman and five members, two
of whom are full-timewith functionalresponsibilityfor eugineeringand finance.
BIWTA has a sanctionedstaff strengthof 3,978 and a posted strengthof 3,125,
and is generally believed to be understaffed for the extent of its
responsibilities.The organizationstructureof BIWTA is as shown in Chart 2.
Institutionalweaknesses identified in BIWTA's current structure and
4.03
weak implementation of regulatory responsibilities
operations include:
particularlyin tariff regulation; lack of authority and capacity within the
planning function; fragmentationof responsibilityin dredging operations;and
a nearly defunct training capability at the Inland Deck Personnel Training
Centre. Under the pro'ect,BIWTA would undertake a number of actions to rectify
institutionalweaknesses. These include: transferof all regulatoryfunctions
in the area of vessel certificationto DOSt consolidationof all dredging
activities under a single organization unit having control over the full
-19-
Government budget allocation for BIWTA dredgir;,operations; transfer of the
Inland Deck Personnel Training Centre to DOS; expansion of staff through
recruitment of about 600 surplus staff from BIWTC; and enhancement of the
planning function by appointmentof a new Member of the Board for Planning and
Operations. Transferof the Inland Deck Personnel TrainingCentre to DOS will
be a condition of disbursementfor this component [PartE (f) of the project].
Establishment of the Dredging Unit within BIWTA would be a condition of
disbursementof Part A (dredging)of the project (para 3.14). The Government
will also deregulateall IWT freighttariffs,and evidenceof eere&ulationof IWT
freight tariffs would be a conditionof Credit effectivenessof the project.
B. Banzladesh
Inland
Water Transport
Corpc,ration
4.04
BIWTC operates
a fleet of over 400 vessels
on the coastal
and inland
waterways. BIWTC is managed by a Board of Directors (appointedby MOS), which
consistsof the Chairmanand three members. The Corporationemploys 5,900 staff
organized into four major departments: Maintenanceand Operations,Commercial,
Financeand Administration.The Corporationis expectedto be self-financingbut
has been incurringsubstantialdeficitsover the years. In FY89, it incurreda
deficit of Taka 68 million on revenues of Taka 342 million. A majority (90
percent)of the losses are accountedfor by the cargo sector,which suffersfrom
excess fleet capacity, poor operational performance, and substantial cargo
losses.
4.05
Under the project,BIWTC would implementa strategicplan (Annex 5) to
restore it to financialviabilityover the Fourth Plan period. The plan calls
for reducingthe fleet from over 400 vessels to under 150 vessels,with a large
proportionof the reductionsbeing in the cargo sector. The Corporationwould
also establishfive profit centers: coastalpassenger,inlandpassenger,coastal
and inland cargo, ferry services and a ship repair profit center. This will
allow separationof the financialperformanceof each of these businessunits,
and enable appropriatedispositionof each in the future. ManagementConsultants
appointed under the project would recommend for each profit center either
retentionwithin the Corporation,privatizationor liquidation. It is expected
that the coastal passenger operationswould be retained as this is a public
serviceobligationof the Governmentand BIWTCwould be psovideda direct subsidy
for operatingthe coastal passengerservices. In line vlih the fleet reduction,
BIWTC would reduce its staffing to around 3,700 staff. This would be
accomplishedthrough a combinationof early retirements(about 1,000 staff) and
redeploymentsto BIWTA and DOS (about 1,200 itaff). BIVTC would also takeover
from BIWTA the Barisal Workshops,which would become a part of the BIWTC ship
repair profit center.
C. Departmentof ShippiLn
4.06
DOS is a relativelynew organizationand though iPs mandate calls for
it to be the primary regulatorybody overseeinginland water transport,many
regulatory functions continue to be exercised by BIWTA. It is headed by a
Director General of Shipping who reports to the Secretary,MOS. Since its
inception ir 1976, DOS has made substantialprogress in the areas of safety
regulation,maritimepollutionand manpowertraining. Its activitiesin the IW
sector however require considerablestrer¶thening.
-204.07
Under the project,DOS would takeovera number of activitiesfrom BIWTA.
These includes vessel design approval and certification,and the training of
inland vessel crews. The institutionald0velopmentaction plan for DOS calls for
the establishmentof an Inland Ship SatLty Administration(ISSA). ISSA would
have responsibilityover both vessel safety and environmentalprotectionof the
waterways. DOS would take over the Ialand Deck PersonnelTrainingCentre (DPTC)
from BIWTA. In order for DOS to fulfill its expanded responsibilities,
particularly for enforcing safety regulations on the waterways, its staff
strengthwould graduallybe increasedby about 600 staff who would be recruited
from the surplus staff at BIWTC. An understandingwas reached with the
Governmentthat DOS would receive an increasedbudget to reflect the increased
cost of its safety related activities(Annex 14).
D.
IMplementationof Agreed Action Plans
4.08
The following action plans, which were prepared by GOB and discussed
with IDA, were agreedat negotiations,and will be implementedby the Government,
BIWTA, and BIWTC. These are:
(a) BINTA Operations Imxrovement Action Plan (Annex 4) which requires
measures to improve dredgingoutput from about 2 million cubic meters
per year to 6 million cubic meters by 1995, maintenanceof navigation
aids and hydrographicsurvey operations;
(b) BIWTC StrategicPlan (Annex5, Part F) which includesrestructuringof
the fleet from over 400 vessels to under 150 vessels and rehabilitation
of selectedvessels, implementationof tariff increasesfor ferry and
passenger services,and phasing out of cargo operations;
(c) BIWTA InstitutionalDevelopmentAction Plan (Annex 6, para 7) which
includes restructuringthe organizationfor dredging,deregulationof
freight tariffs, redeploymentof staff from BIWTC, increasedea4hasis
on planning,and transferof training functionsto DOS;
(d) BIWTC InstitutionalDevelopmentAction Plan (Annex 6, para 12) which
includesestablishmentof five profit centers and reductionsin staff
through redeploymentand early retirement;and
(e) DOS InstitutionalDevelopmentAction Plan (Annex 6, para 14-19) which
includesconsolidationof trainingfunctionsfor the maritimesector in
DOS, and establishment of an Inland Ship Safety Administration
responsiblefor saVety and environmentalcontrols.
These action plans are based on recommendations
of consultantstudies,which were
conductedin preparationof the project (Annex 19). These studies include: (a)
the BIWTC Fleet Developmentand Rationalization
Study,which formed the basis for
the BIWTC Strategic Plan; and (b) several studies funded by the United States
Trade and Development Program, which formed the basis for the institutional
developmentaction plans, and BIWTA'soperationalimprovementaction plan.' The
Project Monitoring Unit (para 3.17) will be responsible for monitoring the
implementationof these action plans and for assessing the success of specific
actions in achieving desired objectives (Annex 15). Progress reports on each
action plan would be prepared by each agency and consolidatedby the PMU for
review by the Governmentand donors.
-21-
V.
FINANCIALANALYSIS
5.01
This section evaluates the financial performance and financial
managementof BIWTA and BIWTC, and recommendschanges in tariffs,and financial
and operatingpolicieswhich would help improve their overall performance.
A.
BangladeshInland
Water Transport
Authority
5.02
BIWTA has always been financed by a combinationof Govern.entbudget
allocations,and its own revenuesfrom conservancyand pilotage,inlandports and
canal tolls.
To date, therehas been no explicitpolicy regardingcost recovery
Government believes BIWTA's financial
or financial targets for BIWTA.
performancehas been unsatisfactory,and would like to see financial reforms
implemented. The recommended measures and financial targets comprise an
integratedfinancialrecoveryplan (Annex16, para 12). The plan is desiV.edto
encourage financial discipline and sufficient liquidity for operational and
investment requirements. The paragraphs below provide a summary of BTWTA's
financialperformance,and details are in Annex 16.
5.03
Past Financial Performance. Table 5.1 below sumharizesthe audited
accountsof BIWTA for the period 1984 to 1988. BIWTA's financialperformAnceis
characterizedbyt (a) low tariffs and an erratic revenue performance; (b)
accumulatinglong-termdebt; (c) apparentexcess liquidity,as evidencedby its
current ratio; and (d) poor billing collections. It is necessary to establish
separate responsibilitycenters for revenue and regulatoryactivitiesin order
to account consistently for each. The net loss in 1988 dropped to Tk 5.3
million,from Tk 48.3 million in the previousyear. The annual loss is, however,
understatedthroughoutthe period,because interestchargeddoes not reflecttrue
interestexpense. BIWTA'sbalancesheet showsaccumulatinglong-termdebt,which
is not being servicedregularly. As of June 30, 1988, this debt amounted to Tk
883.3 million. Under the proposed project, GOB has agreed to reschedulethe
total outstandinglong-termdebt (as of July 1, 1990) over a period of 20 years?
with an effective interest rate of 9 percent p.a. as a condition of credit
effectivenessfor the project. The high current ratio does not reflect the
correct liquidity position because of excessive stocks of inventory, some -f
which are unusable. BIVTA would revalue all stocks, and sell obsolete and
mismatched stocks by FY93. Accounts receivableinclude arrears that have been
outstandingfor a long time and are unlikelyto be collected. BIWTA would write
off some arrears,enforcecollectionof those that can be collected,and thereby
reduce the level of accountsreceivableto about four months of revenueby FY94.
These and other actions have been includedin a financialrecoveryaction plan
(Annex 16, para 12) which was discussed and agreed with the Government at
negotiations,and will be reviewedannuallyby IDA and BIWTA.
-22Table
5.1s
BIWTA'S PAST FINANCIAL PERFORM=NCB
(In Taka Millions
Except
as Stated)
1488
Fiscal Year
1984
1985
1986
1987
GovernmentGrants a/
Revenue
Working Expenses
Depreciation
61.7
113.7
154.4
34.0
79.2
165.2
187.4
36.0
1.8
73.9
122.6
203.3
44.9
4.4
88.1
134.3
225.7
44.2
0.8
19.2
(52.1)
(48.3)
0.91
5.9:1
44/56
1.24
5.6:1
45155
1.21
5.3:1
47/53
1.01
5.8s1
47/53
9.0
1.7
9.0
1.8
7.6
1.7
Interest Charges
--
Surplusl(Deficit)
(13.0)
Operating Ratio
Current Ratio
Debt/EquityRatio
1.07
5.4:1
Accounts Receivable (Months)
Accounts Payable (Months)
a/
46154
6.3
1.4
6.6
1.0
142.7
160.4
257.2
49.0
2.1
(5.3)
Includes allocations for dredging, which is shown in Annex 16 as part of
revenue.
5.04
BIWTA Tariffs and Revenues. The projections below depend critically on
increased tariffs and recurrent Government allocations for nonrevenue services.
On tariffs, BIWTA's sources of revenue consist of (a) port charges; (b)
conservancy fees; (c) pilotage fees; (d) canal charges; and (e) dredging charges.
A description of these tolls and charges is found at Annex 16, Table 4.
These
tolls and charges have not been revised recently, and they do not reflect the
cost of providing services. DIWTA recognizes the need to increase its revenues
and is committed to increase them to cover costs of operation and debt service
(Annex 16, Table 3). BIWTA will be expected to progressively increase tariffs
to cover full cost of operations of its revenue earning services plus the greater
of depreciation or debt service. To this end, IDA sought in increase of 30
percent in BIWTA tolls and charges as a condition of Board Presentation of the
project and this has been accomplished. Hereafter, BIWTA will revise tariffs
annually to generate sufficient revenue to cover the costs of all revenue earning
operations including operating costs and depreciation or debt service by 1995.
These annual reviews are estimated to result in a tariff increase of about 25
percent in FY92, declining to about 4 percent in FY94. BIWTA is not expected to
cover the costs of its nonrevenue earning services. At present, allocations do
not cover the cost of services. Agreement was reached at negotiations, that the
Government will exchange views with IDA annually on the financial projections f r
BIWTA including measures to enhance tariffs and allocations for nonrevenue
earnang services and implement such increases to ensure that BIWTA meets its cost
recovery obiectives.
5.05
Financial Proiections. Projected financial statements are included at
Annex 16, and are summarized in Table !.2 below. BIWTA's objective over the
project period will be to cover the costs of revenue-earning operations from its
own revenue by 1995. The level of recurrent Government allocations to BIVTA has
been insufficient to effectively develop and maintain the waterways. Government
-23allocationswill increaseto reflect increaseddredgingoperations. It is also
expected that operational cost reductions will be achieved through the
implementationof a fuel monitoring system under the project. With these
expectedpolicy actions,BIWTA can achievea marginalprofitabilityof about Tk
15.8 million by the end of the Fourth Five-Year Plan.
Table 5.2: BIWTA'1 PROJECTEDFINANCIALPERFOINANCE
(In Take Nillions Except as Stated)
Fiscal Year
GovernmentAllocations
Revenue a/
Working Expenses
Depreciation
InterestCharges
Surplusi(Deficit)
Operating Ratio
Current Ratio
Debt/EquityRatio
a/
1990
1991
1992
1993
1994
1995
166.9
184.0
306.4
45.5
5.7
(6.7)
1.0
3.9sl
49/51
200.2
240.8
332.3
48.5
104.3
(44.1)
0.9
3.6sl
52/48
250.1
309.9
381.7
53.1
132.1
(6.8)
0.8
3.5s1
56144
300.3
368.3
431.1
61.5
173.3
2.6
0.7
3.4sl
61/39
349.9
413.2
475.7
73.1
206.2
8.1
0.7
3.4:1
65135
400.3
508.2
521.4
84,5
225.1
15.8
0.7
3.3X1
66134
Revenue in this table only includes revenue earned by BIWTA; it does not
include dredgingallocations which are includedin Governmentallocations.
B.
Bansladesh Inland Water Trnpr
oporation
5.06
BIWTC's stated financial
objectives
are to operate commercially ensuring
that revenuesgenerated from its services
are sufficientto cover all operating
expenses includingthe greater of depreciationor debt service,and contribute
to about 10 percent of its annual capital investmentcosts. BIWTC's financial
projectionsindicatethat, if it implementsneeded reforms,it should be able to
achieve deficit free operationsby the end of the Fourth Five-YearPlan in 1995.
Details of the financialevaluationof BIWTC are provided in Annex 17, and the
following paragraphs
provide a summary.
5.07
Past Financial
Performance.
BIWTC's past performance was assessed on
the basis of audited financialstatementscoveringthe period FY84 to FY88, and
is given in Annex 17. Table 5.3 below provides a summary of key finmacial data
for this period.
The average annual growth in revenue over the five-year
period
was two percent;
cargo revenues declined
continuously,
wbile ferry
revenues
increased
significantly.
Expenses have risen largely due to Government wage
increases.
Net losses increasedfrom Tk 4.9 million in 1984 to Tk 53.1 million
in 1988. Over 90 percent of these losses were in the cargo sector,and only the
ferry sector made profits.
-24Table 5.3: BIWOC'S PAST FIHANCIALPEBJORMANCE
(In Taks Millions Except as Stated)
FiscalYear
Revenue
WorkingExpenses
Depreciation
InterestCharges
Surplus/(Deficit)
WorkingRatio
OperatingRatio
CurrentRatio
L-T Debt/Equity
Ratio
AccountsReceivable(Months)
AccountsPayable(Months)
1984
1985
1986
1987
1988
301.8 356.8 341.7
303.9
329.8
269.6
319.8 332.0
310.1
334.4
31.7
35.8
41.4
40.5
39.3
7.9
17.0
18.2
18.3
19.2
(4.9) (10.8) (44.9) (55.0) (53.1)
0.87
0.90
0.97
1.02
1.01
1.00
1.00
1.09
1.16
1.13
2.0s1
58/42
6.5
3.8
1.9:1
47/53
5.2
2.8
1.9t1
48154
5.4
2.9
1.8:1
51149
6.3
3.4
1.621
43/57
7.2
3.3
5.08
BIWTC's balance sheet is characterizedbys (a) a low debt to equity
ratio; (b) outstandingintereston debt; (c) a high level of accountsreceivable
(most of it uncollectible);and (d) a high level of stocks and inventoriesof
which 50 percent are obsolete. The low debt to equity ratio results from
conversionof some debt into equity in 1985 and inclusion in reservesof a 1988
borrowingfrom GOB (in anticipationof a conversioninto equity). As of June 30,
1989, outstandingprincipalwas Tk 708.7 million while the outstandinginterest
was Tk 176.2million. At negotiations,IDA reachedagreementwith the Government
to reschedule
the totaloutstanding
long-term
debt (as of July 1, 1990)over20
years besinning in FY92 at an effective 9 percent rate of interestwhich is an
average rate for the out anding loans. Agreement was also reached to have
BIWTC's overdue interestconvertedinto Governmentequity. These aRreementsare
conditionsof Credit effectivenessfor the project.
5.09
Under the proposed project, BIWTC would implement an action plan to
reduce the level of its accounts receivableto about four months of revenue by
the end of FY94. Additionally,IDA would seek assurancesthat BIWTC will carry
out a detailed inventoryvaluationand verificationof all stocks and spares on
a basis satisfactoryto IDA, and will sell off or dispose all obsolete, damaged
and mismatchedstocks. During negotiations,assuranceswere receivedthat these
actions would be completedby end 1993.
5.10
BIWTC TAriffs. BIWTC's passenger and freight tariffs are established
by BIWTA, as the regulatory agency responsiblefor IWT operations. Although
tariffs are supposedto be revisedperiodically,this is not always the case, and
current tariffs do not reflectthe cost of providingservices. In October 1989,
BIWTC increased ferry tariffs by 30 percent. This increasewas a step in the
right direction, but further increases are needed if BIWTC is to reach its
financial objective. During negotiations, IDA sought agreement with the
Governmentto reviseand implementtariff increases(Table5.4 below) as follows:
(a) proposed tariffs regroupingin the ferry sector resulting in an effective
increaseof 15 percent;and (b) a 25 percent increasein the passengersector for
all classes of passengers. These increases were a condition of Board
Presentationof the project and have been fulfilled. Agreementwas also reached
-25at negotiationsthat the Governmentand IDA will exchangeviews on BIWiC'sannual
financial proiections (includinR subsidies for coastal operations) and that
tariffswill be progressivelyincreasedto cover the full cost of operationsand
the greater of debt service or depreciationplus a 10 percent contributionto
investmentby 1995. These annual tariff reviews are estimated to result in a
tariff increaseof about 10 percentin FY92 decliningto 5 percentby FY95 (Annex
14).
Table 5.42
PROPOSEDCRANGES IN BIM
Existing
Fare
Passenger:
Deck Class
First Class
Second Class
Third Class
Tk
Tk
Tk
Tk
Ferry Operationsa/
Trucks (5 tons)
Car/Jeep
Tk 367/crossing
Tk 81/crossing
TARIFFS
Proposed
Initial
Increase
New Fare
(FY91)
Tk
Tk
Tk
Tk
10Z
25Z
251
251
0.35/pass/mile
1.40/pass/mile
0.75/pass/mile
0.52/pass/mile
0.39/pass/mile
1.75/pass/m'le
0.94/pass/mile
0.66/pass/mile
(Regrouping)b/ Tk 500/crossing
85/crossing
Tk
(Regrouping)
a/ Example of increasesunder tariff regrouping.
bl The tariff regroupingwill result in a 15 percent increasein ferry revenue.
5.11
Financialprojectionsfor the years FY90 to FY95 are shown at Annex 17
and are summarizedin Table 5.5 below. The financialprojectionsshow a gradual
improvementin BIWTC's performanceas a result of: (a) tariff increasesas set
out above; (b) the implementationof a fuel monitoringeystemwhiclh
will cut fuel
costs by about 15 percent; and (c) implementationof the staff retrenchment
program,which will reduce staff costs by about 20 percent.
Table 5.5s BIVTC'S PROJECTEDFINANCIALPERORMIANCE
(In Taka Nillions
Except as Stated)
Revenue
Expenses
Depreciation
Interest
Surplus(Deficit)
Operating Ratio
CurrentRatio
Ratio
Debt/Equity
1990
1991
1992
1993
1994
1995
419.9
367.9
47.7
73.4
(59.1)
488.1
368.7
78.2
80.6
(29.3)
552.0
375.3
82.2
97.9
6.5
669.6
394.5
95.4
186.6
3.1
764.2
412.3
117.5
234.6
9.9
845.4
441.8
137.5
262.2
13.9
1.0
3.2:1
44/56
0.9
3.1:1
46/54
0.8
0.7
3.1:1
50/50
2.9:l
63/47
0.7
2.9:1
68142
0.7
3.1sl
70/30
-265.12
Financial Management. Budgetary control, particularlyon recurrent
expenditureis poor, and actual expendituresare usuallyconsiderablyhigher than
budgetedfigures. Under the project,the managementconsultantsproposedas part
of the strategic plan (para 3.19) would have the resoonsibilityof assisting
BIWTC prepare annual work programs and accompanyingbudgets, and also train
accountingand planningstaff. BIWTC maintainsan audit division,which reports
to the Member Finance. This structureneeds to change to have the audit division
report directly to the Chairman, to ensure autonomy of the audit function. A
financialrecovery action plan for BIWSC (Annex 17, para 13) was discussed and
agreed during negotiations,and the targets and performance outlined in the
action plan will be reviewedannuallyby IDA and BIWTC.
C. Accounts and Audit*
5.13
DOS, BIWTA and BIWTC would maintain separate accounts of project
receiptsand expenditures. These accountsand Statementsof Expenditures(SOB)
for which Credit disbursementswill be made, would be audited annually by the
Comptrollerand Auditor General,GOB. The audit report would contain a separate
opinionby the auditorsthat all disbursementsmade on the basis of SOEs were for
works and services,includingdredging,which were requiredfor the project,and
that the SOEs can be relied upon to support the related withdrawals. The
accountsand reports of these auditswould t1esubmittedto IDA within nine months
of the end of the fiscal year. The books and accounts of BIWTA and BrWTC would
be audited annually 'y independentauditors acceptableto IDA. The auditors'
reports would be submitted to IDA within nine months of the end of the fiscal
years of BIWTA and BIWTC.
VI. PROJECT JUSTIFICATION
6.01
Economic evaluation of the project is based on the following
improvementsto the inland water transport system:
(a) day and night navigational aids to be provided on five main
navigational routes (totallingapproximately1,200 route kilometers)
will improvenavigationon stretches of waterway totallingaround 725
kilometersand reduce the need for pilots and associatedvessel delays;
(b) dredging works to improve least available depth (LAD) along three
inland river routes (Kushiyara,Kangsa and Titas Rivers) from 0.9 m to
1.8 m will reduce transport costs, and dredge operationsimprovements
will reduce the unit cost of dredging from Taka 28/cu m to Taka 21/cu
m; and
(c) improvementsin berthingfacilitiesat 100 rural locationsfor launches
to load and unload passengersand cargo will reduct delays to vessels
and passengers,and damage to cargo.
The above system improvementscorrespondto three groups of investmentsfinanced
under the projectt navigationaids, dredgingand rural pontoons,which account
for 71 percent of total project costs. Details of the analysesare in Annex 18.
-27A. IconuoicCost Estmates
6.02
For this analysis, all inputs and outputs have been evaluated in
constantJune 1990 economicprices. Financial costs were convertedto economic
costs by shadow pricing major cost components and by applying aggregate
conversionfactors estimated for Bangladeshto the remainingcomponents. Price
contingencies,taxes and duties are excluded. Conversion factors used for
various cost categories were: (a) for fuel - 0.85; skilled labor - 0.89;
unskilled labor - 0.7; and (b) for other domestic items the standardconversion
factor of 0.80.
B. Bstimationof Benefits
6.03
The Aid8-to-Navigation
componentof the projectwould generatebenefits
through reductionsin (a) average vessel delays awaitingpilots, and (b) voyage
times due to improved speeds enroute. The savings realized are the avoided
operating costs of the vessels through elimination of these delays. Nonquantified benefits would include improved safety and reductions in vessel
damage/lossesresultingfrom improvedchannelmarkings. The benefitsaccrue to
both passengerand cargo vessels,though the value of these savingsdiffer based
on the average vessel sizes used on various routes and operations. Details on
the computationof benefits are presented in Annex 18, Tables 2 to 4.
6.04
Dredgingimprovementsincludedin the projectachievebenefitsthrough:
(a) reductionsin the unit (economic)cost of dredgingfrom Taka 28/cu m to Taka
2l1cu m; and (b) reductions in cargo and passenger transport costs from Taka
1.39/ton-kmand Taka 0.32/pass-km,to Taka 0.90/ton-kmand Taka 0.27/pass-kmon
the three routes (Kushiyara,Kangsa and Titas River) where the Least Available
Depth is increasedfrom 0.9 m to 1.8 m. Details of the evaluationare provided
in Annex 18, Tables 5-8. These river routes are importanttransportarteriesfor
stone materials used for constructionin Bangladesh(the lack of adequatestone
supplies in most areas is a major constraint for the construction sector
throughoutthe country). Improvedchanneldepth on these routeswill reduce the
cost of constructionin much of Bangladesh.
6.05
Rural launch landing pontoons to be financed under the project will
result in improved accessibility to the rural areas of Bangladesh. The
quantifiablebenefits stem primarily from savings ins (a) vessel time; (b)
passenger time; (c) handling cost of cargo; and (d) reduced damage to cargo.
Without the project these rural areas are being served by vessels which cannot
come alongside the shore, and passengersand cargo must be ferried to and from
the vessels by small country craft. This results in significant delays to
passengers and damage to cargo. Details of the evaluation are in Annex 18,
Tables 9-10.
6.06
Benefit estimates are conservativein that no estimates are made of
traffic generated on account of cost reductions. Most importantly,however,
there is no quantificationof safety improvementsand reduced loss of life and
property from IWT accidents.
-28C. Economic Rates of Return
and Sensitivity
AnaliY.
6.07
For each of the above three components (and their subcomponents)
economicrates of return (ERR)and theirnet presentvalues (NPV)at a 12 percent
discountrate, were computedand details are providedin Annex 18. Sensitivity
analyseswas carried out for a 15 percent reduction in benefits, a 15 percent
increase in costs, and for a combinationof the two with a one year delay in
benefits. Results obtainedare summarizedin Table 6.1 below.
Table 6.1s ERR AID NPV OF PROJICT COHPOUETS
(In X and TAka Millions)
Base Case
ERR(Z)NPV
Sensitivityof the
(RRM)
-152 Benefits +152 Costs Combined ia
1. NavigationalComponent
31.7 315
26.6
25.8
L6.S
2. Dredging Component
22.9 227
18.7
19.2
12.5
3. Rural Launch Pontoons
26.3 311
22.0
22.6
15.2
4. Project Returns
(on 712 of costs)
26.5 853
22.5
21.9
14.6
/a Combined effect of 15 percent decrease in benefits, 15 percent increasein
costs and a one year delay in benefits.
6.08
For the overall package of investments to be financed under this
project,the rate of return has been calculatedbased on the benefits quantified
for t%e abovementionedthree components,but with the costs includingall of the
technical assistance and other components for which benefits have not been
quantified(Annex 18, Table 11). This resultedin an ERR of 15.7 percent and a
NPV (at a 12 percent discount rate) of Taka 344 million.
6.09
The sensitivityanalyses presented in Table 6.1 above indicates that
even with the combined effects of a one year delay, a 15 percent decline in
benefitsand a 15 percent increasein costs, the project componentsobtain fairly
high rates of return.
Investments proposed are well diversified, both
geographicallyand functionally,and therefore the overall benefit stream is
likely to have lower risk. Also, the project is unlikelyto suffer from extended
implementation delays due to the simple nature of most of the physical
components. The economic justificationof these investments is therefore
reasonablyrobust.
D. EnvironmentalAssessmzat
6.10
An environmentalassessment of the IWT sector (financed under the
NetherlandsTrust Fund) was undertakenby IDA in the preparationof this project.
Protectionof the environmentis presentlygovernedby the EnvironmentPollution
Control (EPC) Ordinance of 1977. The Department of Environment Pollution
Control, under the newly created Ministry of the Environment, acts as the
regulatoryagency. A "MarinePollutionOrdinance'has been drafted by DOS and
-29has been passed as an Act of Parliament. The latter ordinance primarily
addresses pollution in the coastalwaters and seaportsof Bangladesh. Whereas
the EPC Ordinanceof 1977 is intendedto cover inlandwaterways,no implementing
regulationshave been developed as yet covering specific activities such as
dredging, construction of structures affecting waterways and other waterway
developmentactions.
6.11
Among the key findingsof the environmentalassessmentcarried out by
IDA, the followingare most noteworthy: (a) no testing is carried out of dredge
materialsprior to disposal; (b) there is no data on possiblecontaminated*hot
spots" in the bottom sediments near industrialplants; and (c) there are no
emergencyplans establishedto deal with incidentsinvolvinghazardous cargoes.
6.12
Under this project,a number of actions are to be taken to address the
above deficiencies. First, an environmentalmap of the waterway system is to be
created identifying specific environmentallysensitive areL. and activities.
Such a mapping and the upkeep of the associatedGeographicInformationSystem
would enable quick environmentalassessmentsof proposed waterway activities.
Second, simple test facilities for dredge materialslbottomsedimentswill be
provided and personnel will be trained in the use of this equipment. Third,
technicalassistancewill be providedto DOS to develop implementingregulations
Annex 7 provides details on the
for the protection of inland waters.
environmentalactions under the project.
Potentialenvironmentalrisksassociatedwith the physicalinterventions
6.13
under the project are considerednegligible. Dredging operationscontemplated
are generally far removed from industrial plants where sediments may be
contaminated,with the exception of dredging that may be carried out in the
BurigangaRiver. For the latter diked (contained)disposalof dredge materials
will be employedif testing revealsthe need to do so. The environmentalaspects
of dredging will be improved under the project since for the first time,
Bangladeshwill undertake dredge materials testing for all dredgingworks. In
most cases, it is expected that in-streamdisposalwill be acceptablein view of
the general lack of contaminatedsedimentsand the high ambient turbiditiesin
Bangladesh'srivers. Inland pontoonsfinancedunder the project are unlikelyto
create significantdislocationsin rural areas as these pontoon locationsare
alreadyservingas landingstages for inlandvessels. The project,however,does
require BIWTA to ensure that selected locationsprovide adequate facilitiesto
prevent adverse impactson adjacentpopulationsand land-usepatterns (Annex 3,
Criteria for Location of Pontoons).
B. Special Considerations
6.14
The project will have some implicationsfor elements of the Bank's
programsof specialemphasis. Povertyalleviationin the water transportsector
primarily requires improving the condition of country boat operators. These
boats employ many landless rural poor. The project would assist them through
establishmentof facilitiesand extension services to improve their access to
technologyand capital (Annex 8). The project also places a major emphasison
improvingthe infrastructureavailableto countryboat operatorsby financing100
pontoons to be located in rural areas as landing stages for country boats and
launches. This would benefit the rural poor indirectlyby lowering transport
costs, increasingmobility,reducingprices of purchasedcommoditiesand raising
farmgateprices of agriculturaloutputs. With respectto resourcemobilization,
-30the projectwill includea numberof actionsto increaseGovernmentrevenuesin
the water transportsector,and to reducethe deficitsof BIWTC. Theseinclude
increasesin the tariffsfor the use of BIWTA facilities,
BIWTC ferriesand
passengervessels,and rationalization
of BIWTC operations.The projectalso
indirectly
impactson the conditionof womenin Bangladesh.Postdata indicates
thata disproportionate
numberof the fatalities
on the waterwaysare womenand
childrenwho are trappedunder-deck
whenvesselscapsize. Throughits emphasis
on safetyon the waterways,the projectshouldsignificantly
reducecasualties
among water transportpassengers. The projectalso creates the conditions
necessaryfor futureprivatization
of partsof BIWTCoperations.By separating
pure public service obligations(coastalpassenger services)from other
operations,
and furthersegregating
profitablesectors (ferryservices)from
lossmakingoperations(cargo), the Governmentwill be well situated to
appropriately
disposeoff those operationswhere it no longer needs to be
involved.
1.
ProjectRisks
6.15
The most significantrisks faced by the proiect lie in the
implementation
of the varioustechnicalassistance
componentsand actionplans
for improvementsin operationalefficiency,financialperformanceand for
institutional
change. Whereas there is strong Governmentcommitmentfor
undertakingthese actions at present,with the inevitablerotationof key
officials,implementation
will requirepersistenceon the part of project
personneland the variousGovernment
agenciesinvolved.Theserisksare managed
throughprovision
of appropriate
technical
assistance
whichhas beenput in place
as conditionsof Credit effectiveness.In order to minimizethe risk of
implementation
delays,the ProjectMonitoring
Unithas beenmade responsible
for
taieaction plans in addition to the usual responsibility
for monitoring
implementation
of physicalinvestments.A detailedset of projectmonitoring
Indicators(Annex14) has also been preparedto assistthe Governmentand IDA
supervision
missionsto closelymonitorimplementation.
VII. AGREDMINTSRR&CHRDAND RICOUNNDATION
7.01
During negotiations,the Associationreached agreementwith the
Government
on the following:
(a) That GOB will includethe funds for DOS componentsin its regular
budget allocation in accordancewith the agreed schedule of
implementation
(para3.13);
(b) ThatGOB and the donorswill conducta jointmid-termreviewof project
implementation
by June 30, 1993, and will make adjustments
to the
projectas necessary(para3.22);
(c)
The BIWTAOperations
Improvement
ActionPlan [para4.08 (a) and Annex
41 would be carriedout;
(d) The BIWTCStrategicPlan [para4.08 (b) and Annex 5J wouldbe carried
out;
-31(e) The Institutional
Development
ActionPlans[pa&r4.08 (c),(d),(e)and
Annex 6] for BIWTA,BIWTCand DOS wouldbe carriedout;
(f) The targetsand performance
outlinedin the financialrecoveryaction
plan for BIWSA (paras5.03 and Annex 16) will be reviewedannuallyby
IDA and BIWTA;
(g) The Government
will exchangeviewswith IDA annuallyon the financial
projectionsfor BITWA includingmeasures to enhance tariffs and
allocationsfor nonrevenueearning services and implement such
increasesto ensurethatBIWTAmeetsits costrecoveryobjectives
(para
5 04);
(h)
The Government and IDA will exchangeviewson B!WTC'sannual financial
projections
(including
subsidies
for coastaloperations)and that
tariffs
will be progressively
!ncreased to cover the full cost of
operations and the greater of debt service or depreciation
plus a 10
percent contribution
to investment by 1995 (para 5.10); and
(i)
The targets and performance outlined in the financial recoveryaction
plan for BIWTC(para 5.12 and Annex 14) will be reviewed annually by
IDA and BIWTC.
7.02
The following would be conditions
of Credit
Iffectivemess:
(a)
Approval by GOBof the project
(para 3.11);
(b)
Effectiveness
of the grant agreement between GOBand the Government of
Finland covering technical assistapce
(para 3.12);
(c)
Effectiveness
of the Japanese
Association (para 3.12);
(d)
Execution of the subsidiary
BIWTC(para 3.13);
loan agreements between GOBand BIWTAand
(e)
Appointment of the Project
3418);
Design and Coordination
(f)
Appointment of the BIWTCManagement Consultant
(g)
GOBwill deregulate all freight
and Annex 6, para 8);
proformas for carrying
grant
tariffs
out the project
agreement between GOB and the
Consultant
(para
(para 3.19);
in the IWT sector
(para 4.03,
(h) GOB will rescheduleBIWTA'stotal outstanding
long-termdebt (as of
July 1, 1990) over a periodof 20 years,with an effectiveinterest
rate of 9 percentp.a. (para5.03);and
(i) GOB will rescheduleBIWTC'stotal outstanding
long-termdebt (as of
July 1, 1990)over a periodof 20 years,with an effectiveinterest
rate of 9 percentp.a. GOB also agreedto convertBIWTC'soverdue
interestintoGovernment
equity(para5.08).
-327.03
The followingwould be conditionsfor
proceeds:
disburement
of the
Cr lit
(a) BIWTAwill establish
a DredgingUnitheadedby a dredgingprofessional.
This is a condition of disbursement for the dredging component of the
project [para 3.14 (a) and An3ex6, para 7).
(b)
BIWTAwill
systems
complete a study of alternative
satisfactory
to IDA.
This will
electronic
be a condition
position
fixing
of disbursement
for the electronic
position fixing system component of the project
(par& 3.14 (c) and Annex 4, para 19].
(c)
BIWTAwill transfer the Inland Deck Personnel Training Center to the
Department of Shipping.
This is a condition of disbursement for the
Deck Personnel Training component of the project (para 3.14 (d) and
Annex6, para 14].
Recommendation
7.04
On the basis of the above conditions and agreements, the project
constitutes
a suitable basis for an IDA Credit of SDR31.3 million (US$45 million
equivalent)
to the People's Repilblic of Bangladesh, on standard terms with 40
years maturity.
-33-
AAnnexI
Page 1 of 7
BANGLADESH
THIRDINLANDvTmR TRANSPORT
PROJCT
Inland Water Transport
Sector
1.
This Annex sets out the current status and developmentneeds of the
inlandwatertransport(IWT)sectorin the contextof preparationsfor the Fourth
Five Year Plan (4FYP, 1991-1995) of the Government of Bangladesh (GOB).
Observationsmade here are primarilybased on a number of studies2
(a) Bangladesh Inland Water Transport Master Plan (BIWTMAS) - DHV
Consultants,The Netherlandsand BETS Ltd., Bangladesh,
November19883
(b) Reports prepared by Water ResourcesCongressas consultantsto the
International Development Association (IDA) on Institutional
Development,Training,Dredging,HydrographicSurveys, and Aids-toNavigation,November1989; and
ic) BITWC Pleat Rationalization
and DevelopmentStudy, by Universityof
Newcastle-Upon-Tyne
as consultantsto IDA, April 1989.
This paper also benefittedfrom various analysescarried out by GOB and IDA
staff.
2.
The importanceof inlandwater transportfor Bangladeshis evidentfrom
Table 1 which shows currentand projectedmodal sharesof road,water and rail
transport. Even though there is considerableuncertaintyattached to the
forecasts,it is clear that inland water transportwill continue to play a
significantrole in both passengerari freightmovements. Taking the lowest
forecastsfor both totaltransportoutput and IWT mode shareproducesIWT output
levels in 1995 which are higher than at presentsIV? passenger-kilometers
will
increasefrom around 5.6 bxllionpass-kmto 6.3 billionpass-kmin 1995;and TWT
ton-kilometers
will increasefrom around1.7 billionton-kmto 2.2 billionton-km
over the same period. A few additionalobservations
are noteworthy.
Table 1:
MODAL SHARESIN PASSENGER
ANDFREIGHT
TRANSPORT
Total
Pass-Km
Estimated:
1985
Passenger
Mode Shares
Road Water Rail
Total
Ton-Km
Fieight
Mode Shares
Road Water Rail
35 billion
642
162
202
4.8 billion 482
35Z
17S
ProjectedRanges:/a
1995 High:
59 billion
Low:
42 billion
692
562
242
152
202
162
9.4 billion 572
7.2 billion 452
371
S01
182
122
I/Mode shareswill not add to 100 percentdue to theirbeing max/minestimates
for each mode.
Sources:BIVTNMS; Intermodal Transport Study, 1985; and Bangladesh Energy
PlanningProject,1987.
Anex 1
Pose 2 of 7
-34-
First, the share of IWT in passenger transport in Bangladesh is very high
compared to other countries, reflectingthe essentially riverine geography of
Bangladesh. Second, IVT transportflowsin Bangladeshare dominatedby passenger
movementswhich is the reverseof the situationin most countries. Both of these
observationsindicatethat passengertransportis a major functionof the inland
waterways, and hence IWT developmentshould specificallyconsider the needs of
passengers.
A. Performanceof the IRT Sector
3.
In order to assess the relative performnce of the IWT sector in
Bangladesh,it is useful to examinecomparativedata from other countries. Since
data was available for the Peoples'Republic of China, Table 2 providesChinese
comparatorswhich were selectedto avoid significantdistortionsdue to the very
different absolute magnitudes involved in any comparison between China and
Bangladesh. Once again, the importanceof passengertransportfor Bangladeshis
evident,with a traffic
intensityof an order of magnitude greater than that
found on China'swaterways. Also, interestingis the relativelyhigh densityof
ports on Bangladeshiwaterways (6.7 per 100 route km vs. 1.0 in China), which
indicatesthat Bangladesh'swaterwaysystemis comparatively
well integratedwith
the rest of the transport system and hence can play a strong role in economic
development. 'Whereas
no comparativedata was availableon passengerfacilities,
the density of such facilities (58 per 100 route kms) in Bangladeshindicates
again the good access that exists to the waterway system--approximately
one
passenger landing per 4 kilometerson each river bank.
Table 2: WATRWAY SYSTRI COMNAUSONS a|
Bangladesh
Passenger-Kilometers
(billion)
freight Ton-Kilometers(billion)
NavigableWaterways (kilometers)
Inland Ports (approximatenumbers)
Passenger Facilities (approximatenumbers)
Density of PassengerFacilities
(facilitiesl100route kms)
Mode Share IWS in Passenger Transport
Node Share Irw in Freight Transport
ComParators:
PassengerTraffic Intensity (pass-kmlroute-km)
Freight Traffic Intensity (ton-kmlroute-km)
Density of Ports (ports/100route-km)
5.5
1.6
2,400
150
1,400
58
24
31
China
1S
200
108,000
1,000
--
4.3
17.3
2,300,000 138,900 bi
670,000 1,851,900bI
6.7
1.0
a/ Data are all c. maid-1980's,and therefore are only meant for gross
comparison.
b/ Traffic intensityis somewhatoverestimateddue to the navigable lengthsnot
includingunclassedwaterways.
Sourcess (1) Chino - Water TransportSector Study, IBRD, August 1986.
(2) BangladeshInland Water TransportMaster Plan, November 1988.,
(3) Annual Ports and Traffic Report, Bangladesh, Inland Water
TransportAuthority.
-35-
Anex 1
Pogo 3 of 7
4.
Inspite of this favorable environment for waterway development,the
performanceof inlandwater transportin Bangladeshis poor by almost any measure
of system performance. Table 3 provides comparators for Bangladesh and the
Changjiang(Yangtze)waterwaysystem in China on a few key productivitymeasures.
Table 3: COMPARATORSOF INLAND FLEET PERFORMANCE
Bangladesh
Mechanized
IWT Fleet Capacity (milliontons)
0.54
Comearatorss
Productionper Ton of Fleet Capacity (t-km/ton) 2,500
Productionper InstalledHorsepower (t-km/HP)
4,000
Average Power Utilization (tons capacity/HP)
1 to 2
- for large mechanizedcountry boats
2.5
Fuel Consumption (gm/ton-km)
6 to 8
6
- for large mechanized country boats
China-Chanalianst
7.6
8,000 to 15,000
44,000 to 90,000
3 to 4
--
4 to 5
Sources: op cit.
The data highlightsthe extremelylow rates of utilizationof capital assets in
Bangladesh. While the low output levels for fleet capacityas well as installed
horsepower are partially explained by the lower volumes of ereight flows (in
comparisonwith China), the differenceis so large that it can only be explained
by a very large surplus of tonnage in the cargo sector of IWT. This is borne out
Inland
which indicate for instance that the Bangladesh
by other analysesl/
Water Transport Corporation
(BIWTC) could very comfortably carry the total annual
cargo that it now does with one third of its existing
fleet.
Also, of interest
is the substantial improvements available from introduction of never
technologies. The ratio of capacity to installed horsepower is around 3-4
tons/HP on the Changjiangwhereas in Bangladesh,with a similar if not more
favorable (lowercurrentvelocities)river system,the equivalentfigure is 1 to
2 tons/HP. Introductionof newer vessel technologieswill however depend on the
market for IWT services, and a prior concern must be rationalizationof the
existingfleet to eliminateinefficientvessels. This will also improvethe fuel
consumptionperformanceof the existing "modern*cargo fleet which now performs
not much better than the much smallermechanizedcountryboats. Such elimination
of inefficient tonnage would be based on strict enforcement of vessel
classificationrules and safety requirements.
5.
In view of the above, it is no surprisethat water transportcosts in
Bangladeshpresentpotentiallylarge opportunitiesfor reduction. Table 4 below
sheds some light on this with respect to freight transportationcosts. It is
interesting to note the similaritiesbetween inland water transport costs in
India and Bangladesh. The former alsn has neglected development of the
I/
BIWTC Fleet Rationalizationand DevelopmentStudy, Universityof Newcastle
Upon Tyne.
-36Annex 1
Page 4 of 7
waterways, and water transport technologiesin India are at a similar stage of
developmentas in Bangladesh.
Table 4s INLAND WATER
TRANSPORT COSTS a/
Fixed
(US$/Ton)
Variable
(US$/Ton-Km)
Bangladesh- Tariffs
1.0
0.030
Bangladesh- FinancialCosts
2.1
0.020
India - Financial Costs
2.0
0.017
China - Tariffs
1.4
0.004
a/ These are approximatecosts for general cargo, and have been converted at
the officialexchange rate which for China tends to overstate the cost.
Sources: op cit; 'Bangladesh- Analysis of Inland Waterway Institutions,"Water
Resources Congress,May 1989; and India - An Overview of Inland Water
Transport,Inland Water TransportAuthority of India, November 1989.
6.
The financial performanceof the two sector agencies involved in the
inlandwater transportsectorhas been poor;however,BIVTA's financialsituation
has improvedremarkably. Both BIWTA and BIWTC depend on substantialallocations
from the Government for continued operations. Key financial data for both
agencies are presented in Table 5.
Table 5si FINANCIALRESULTSOF BIVT&AND BITC
1984
BIWTA
Surplus (Deficit)
(Tk million)
Working Ratio A/
Operating Ratio S
1985
(13.0)
0.88
1.07
BIWTC
Surplus (Deficit) (Tk million)
Working Ratio a/
operating
Ratio S
(4.9)
0.89
0.99
19.2
0.77
0.91
(10.8)
0.89
0.99
1986
1987
(52.1)
1.01
1.24
(48.3)
1.01
1.22
(44.9)
0.97
1.09
(55.0)
1.02
1.18
a/
Working ratio
B/
operatingratio is operatingexpenses divided by total income.
is working
expenses
divided
by totalincome.
Source: IDA mission review of financialstatements.
1988
(5.3)
0.84
1.01
(53.1)
1.01
1.16
-37Annex 1
Page 5 of 7
The situationfor both agencieswould, however,be much worse if their financial
statementsfully reflected the interest charges on existing debt obligations.
Financialviability of both of these organizationsis feasible if steps can be
taken to improve operational efficiency in the utilization of assets and
personnel,reduce revenue leakagesand pilferage,and enhance revenuesthrough
appropriate pricing of services.
There is also a need for financial
restructuringin order to enable them to service their debt in the future.
7.
Perhaps the most critical area of poor performance of the Bangladesh
inland water transport sector relates to vessel safety. Passenger vessel
casualtiesfor the period January 1981 to December 1985 were compiledbased on
data providedby the Departmentof Shipping,Governmentof Bangladesh. Over this
five year period, therewere 47 passengervessel disasters,involving62 vessels.
These disasters do not include numerous country boat casualties that go
unreported. Summary data on casualtiesare presented in Table 6. Overloading
accidents (40 percent of the total) are clearly preventable. Of the remaining,
improved safety systems should be able to at least halve the casualty rate.
Collisionsoccur as a result of inadequatechannelmarkings and lack of trained
vessel crews; note that only four of these 47 incidentsinvolveda country boat.
Loss of lives are not reported here because the data is unreliable with
substantialunderreporting. However, when one considers that each of these
vessels carry in excess of 150 passengers,it is not difficultto imagine that
these 62 casualtieshave resulted in loss of lives probably numbering in the
thousands.
Table l:
IVT PASSENGERVESSEL ACCIDENTS 1984-88 aI
Number of Incidents:
Number of Vessels Involved:
Number of Country Boats Involveds
Causest
Overloadings
Collision:
Heavy Weathers
Foundering:
Percentageof Accidents During
October through Aprils
Accident Rates
- Dry Season:
- Monsoons
47
62
4
40.4Z
38.32
17.02
4.3?
702
0.94 incidents/month
0.56 incidents/month
a/ The typical passengervessel carries 150 passengers.
Source: Based on data from 'A Study of Passenger Launch Disasters in
Bangladesh, I Prof. G.M. Khalil,Journal of NOAMI, Vol. 2 Ne. 2 Dec.
1985
-38Annex 1
Page 6 of 7
8.
Waterway maintenancehas also deterioratedin the recent past.
Quantities
dredgedby the Bangladesh
InlandWaterTransport
Authority(BIWTA)and
the BangladeshWater DevelopmentBoard (BWDB) dredge fleets have reduced
significantly
as shown in Table 7 below. In 1986-87,the total quantities
dredgedwere less than 60 percentof the levelachievedin 1984-85,and the
situationhad only improvedslightlyin 1987188when the dredgedquantities
increasedto about75 percentof the levelachievedin 1984185.
Table 7: ANNUALDRIDGINGOUTPUT(1 JULY - 30 JUNE)
(1,000CubicMeters)
BIWTADredges
BIWDB
Dredges
Total
FiscalYear
1985-86
1986-87
1983-84
1984-85
1987-88
2,917
2,842
2,930
3,704
1,781
1,640
1,840
1,722
2,147
2.600
5,759
6,634
3,421
3,562
4,747
WaterResources
Reporton Dredging,
Source: BangladeshInlandWaterTransport,
Congress,Arlington,
VA, 1989.
Utilization
ratesof dredgeequipmentis also very low in comparison
9.
with the potential
capacityof the equipment.As a resultof reducedworking(16
hoursper day, 6 days per week)and nonavailability
of inputssuch as fueland
spareparts,dredgesin Bangladeshtypicallyperformat around40 percent of
their potential capacity.
Comparisons between estimated weekly dredging output
of comparable equipment in the US versusin Bangladesh
are providedin Table8
below.
Table 8:
PURMMKOt OPUIATION
a/
DRUDGOUTPUT
IN CUBICMETESM
Bangladesh
185 Cutter-Head
Dredge
12" Cutter-Head
Dredge
18,700
7,200
United States
47,200
18,900
a/ Computedusing quantitiesactuallybeing dredgedat presentand dredging
time takento be 75 percentof workingtime.
Source: op. cit.
Hydrographic
surveysof the waterwayscarriedout by BIWTAhave
10.
alsofallensubstantially
belowrequirements.
Basedon the datafor threefiscal
years1985-86to 1987-88,the totalhydrographic
surveyoutputhas beenlessthan
in
halfof targettedrequirements.The reasonsfor thishavebeen inadequacies
in the performance
of hydrographic
surveyboatsand degradation
the availability
of the DECCAelectronicpositionfixingsystem.
-39-
Annre1
Page7 of 7
Table 9s uDROGRoArnCSRVEY
AVERAGE
FOR TEO YEWRS 1985186TO 1987188
Target
Actual
InlandNavigation
- Axis (km)
- Sounding(km)
3,750
29,460
1,306
4,761
351
161
Dredging
- Sounding(km)
11,800
5,612
486
Sources
S Achieved
Bangladesh,
Inland Water Transport,
Report on Hydrographic
Water ResourcesCongress,Arlington,VA, 1989.
Surveys,
S. SectorFinanciAn
11.
Table 10 showsthe evolutionof the Annual DevelopmentPlan (ADP)
and recurrentbudgets over the 19809 for total publicexpendituresand for the
transportsector,and the sharesof the three transportmodes. Some of the more
significant
changesthat have occurredin the recentpast includet in 1983184,
the share of the road sector in the developmentbudget increased from a
historicallevelof around35 percent to over 45 percent, while the share of rail
declinedfrom around35 percentto less than 25 percent. More recentlythe share
of rail appears to have declinedeven further. In 1986-87,the maintenance
budgetallocationfor roadswas increasedfrom historicallevelsof around 20-25
percent to around 35 percent. This is partiallythe result of IDA's Road
Rehabilitationand Maintenance Project (Credit 1827-BD), which required a
substantial
increasein maintenanceallocationsfor the road sector. The share
of inlandwater transporthas remainedrelativelystableand has not, in general,
reflected
the relative
importance of this mode in overall transport
supply--this
is discussed in greater detail in Chapter II.
Table 10:
Year
TRANSPORT
SECTORBUDGET
ALLOCATIONS
IN CURRENT
TAKA (KILLION)
Totairienspor*
R
TVJIM
ieter -tota
ITransporrt
iU
won
iTIaer
1980-81
23,6903176(13% 35
1981-82
27,1533241 121 32
1982-8331,2635126 16) 37
36
37
36
29
31
27
13,959 754(5*)
17,299 833 5*)
18,358 907 5t)
32
31
29
S8
56
60
10
13
11
1983-8435,U8 2609(7
1984-8534,9842252 6*
1985-86
40,9552871 R7
47
47
46
24
21
30
29
32
24
20,457
1,145
(6*)
25,870
1,2435*)
34,696
1,641SW)
24
4
25
65
66
66
10
10
9
1986-87
45,1254636(10*) 42
1987-88
46,5064962(11*) 46
28
17
30
37
48,381 1,716 (4*)
44,409
1,987
(5k)
30
5
11
13
54
Source: PlanningCommission,
Governmentof Banglades1i
(CO), February1989.
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-41-
Annex 3
Page 1 of 1
IhNGLADSB
THIRDINLANDWAR TRANSPORTPROJECT
Criteria
for Launch Pontoon Locations
Locations selected for siting of pontoons should fulfill the following
conditionst
(a) on the shoreside the pontoon must be within 1 km of, at a minimum, a
public road, and provisionmust be made for connectingthe site to the
road network with a public road;
(b) on the shoreside,the pontoon site must includeat least 1,000 sq m of
public access land without any encroachmentsother than structuresand
facilities required for the normal handling of passengers and cargo
over the pontoon;
(c) the site must be an existing landing stationfor launches,and traffic
at the selected landing station must now exceed 40,000 passengersor
20,000 tons of cargo per annum or the sum of these two numbers should
at least total 40,000;
(d) two pontoonsshall be sited at least 5 kms apart whenever there is land
communicationavailable between the two sites;
(e) pontoons shall be locatedon waterways having year round navigational
access by vessels drawing four (4) feet of water;
(f) pontoonsshall be locatedat siteswhere the shorelineat Low Low Wate:
(LLW), is less than 20 m from the pontoon;and
(g) no pontoon shall be located where it is likely to pose a hazard to
navigation.
Most foreshore land is already owned by BIWTA and thereforeit is not expected
that resettlementwill be an issue in selectingpontoon sites.
-42Annex 4
Page 1 of 7
BAWGLADISE
TIUD InLANDVATIRTIRASPORT
PROJECT
BIWA Operations I prove"ent Action Plan
A.
Dredging
Introduction
1.
Dredgingof the waterwaysin Bangladesh
is mainlythe responsibility
of
BIWA. Dredgingoperations
are adverselyaffectedby the followingfactors:
(a) Inadequateannu*l dredgingbudget allocation. Budgetedfunds are
inadequateto properly operate and maintain the present fleet of
dredgers,
much less any additionto the fleetor expansionof work.
(b) The currentworkweek consistsof six worn-ing
daysper week and one or
two eight-hour. shifts per day. No oper tion or maintenance work is
accomplished on the third shift or on t'
seventh day.
(c) All dredging operations lack in attendant plant, including floating
derricks,
dredge tender boats, anchor barges, and tugs resulting
in
slowmobilization
of equipment, poor movement between jobs and reduced
dredgingefficiencyoncedredgingoperations
have commenced.
(d) The poorcondition,
or the completelack,of monitoringinstrumentation
normallyused by dredgeoperatorsto maximizeproduction,
as well as
the lackof trainedworkersand supervisors
at the job site.
In view of the foregoing GOBand BIW!A undertookto implementthe following
Action Plan by June 1993.
Rehabilitation
of Dredges
2.
The existingfleetof 18' cuttersuctiondredgeswill be deployedas
follows:
(a) 3 of the oldestdredgeswill be designatedfor standbystatus;and
with new instrumentation
and all 5 will
(b) 5 dredgeswill be refurbished
be mobilized during the 4 months of maximummaintenance dredging work
load. After the peak load demand, scheduledmaintenance will be
carriedout on one dredgeat a time leaving4 dredgesto work during
the off peak period. The repairand improvement
of instrumentation
includess
(i)
installing
new suctionvacuumand dischargepressuregaugesto
the main pump,completewith servicewater or pneumaticreverse
flush blowdown clean-out systems. The gauges should be mounted
at or near the operators's
consolein the leverroom,with repeat
-43-
Annex 4
Pogo 2 of 7
or duplicategaugesin the engineroomat or near the engineer's
station. The operatingvalvesfor the clean-outsystemsare to
console;
be locatedin the leverroomadjacentto the operator's
pressurerecording
gauges
(ii) installing
suctionvacuumand discharge
system
side
of
the
clean-out
room
on
the
opposite
in the lever
recording
console.
These
at
the
operator's
from the gauges
must be furnishedin locking-type
cabinetscomplete
instruments
with a one year'ssupplyof smokedvacuumand pressirerecording
fixes;and
chartsand spray-type
(iii)installingshoresideand shipsidefuel monitoringsystem to
and usage.
controland improveefficiencyin fuelconsumption
of Spare Parts
Procurement
3.
A complete inventory of spares will be preparedby the end of the first
year. No procurement of spare parts will be made until a complete inventory of
and disposed.
existing spares is performed, with the obsolete sparesidentified
tenders and disbursed
international
Spare parts will be purchased by soliciting
as neededto performcapitalwork.
Procurement
of DredBeSupportEquipment
4.
BIWTAwill procurethe followingitemsof dredgesupportequipments
(a) Four 40-footDredgeTenderboats equippedto performlighttowingof
dredge plant; and
(b) Four FloatingStiff Leg Ten (10) ton capacityderricksequippedto
handledredgepipe.
Detailedtechnicalspecifications
of bothof the aboveitemsare in the project
files.
Dredge Operating
Schedule
5.
StartingJuly 1991threedredgeswill be mannedto operate3 shiftsof
8 hourseach,6 days per week. Remaining2 dredgeswill operate2 shiftsof 8
hourseach,6 daysper week. At the end of one yearthismethodwill be reviewed
with the objectiveof going to the third shift on all dredgesas qualified
personnelbecome available. A bonus systemwill be institutedto providean
of 35,000cubicmetersper week per
incentiveto exceeda base rateproduction
dredge.
Disposal of Dredged Materials
will be tested prior to disposal. Dredged
6.
All dredged materials
materials
may be deposited overboard, except in designated environmentally
sensitiveareas. However,any BurigangaRiversediments,
adjacentto the Port
of Dhaka would be contained within a diked disposal area.
-44hAn.m 4
Pogo 3 of I
Disbursemntof Fuel Cost of Dredgins Works
underthisprojectis forecastat
7.
TotalBIWTAdredgingto be supported
2 millionmP/yearof which 1.0 millione8 is capitaldredging. Using BIWTA
for anticipated
increases
in efficiency;
the approximate
experience
and adjusting
variablecostof dredging10 millionin', exclusiveof laborcost is estimatedas
follows:
TotalCosts
US$1m USS millionequivalent
Item
Fuel a/
Repairs
SpareParts
Ancillaryworks,
(Pipelines,
etc.)
Total
8.00
1.92
2.24
0.23
0.06
0.07
2.30
0.60
0.70
1.28
0.04
0.40
13.44
0.40
4.00
a/ MarketpriceUS$1/gallon.
consultant
will releaseUS$0.30,to coverthe cost
The designand coordination
of fueland repairs,for each cubicmetercertifiedas dredged.
Training
of Dredge Operators
8.
BTWTA
will
(a)
carry out a program for personnel
training
that
includes:
On-the-job training of the present number of levermenoperatorsto
sharpenand improvetheir operatingskills. A selectedcadre of
engineersfrommanagementshouldbe includedin this initialtraining
program.
(b) Establishpermanenttrainingclassesfor operatingpersonnel. The
for theseclassesare to be the samepersonnel
who
initialinstructors
provide and installthe new instrumentation
and who conduct the
trainingof the existingoperatinglevermen.They shouldestablisha
curriculumand schedulefor the trainingclassesto providecorrect
trainingof new and existingemployeesof BIVTA in all phases of
hydraulicdredging.The coursesmust emphasizeon-the-job
trainingon
dredgesand some theoryin hydraulicsto help them betterunderstand
the principlesof hydraulicsand hydraulicdredging.
(c) Since the presentoperatinglevermenare semi-literate,
the training
coursesmustbe designedto presentthe information
in a formthatcan
be easilyunderstood
by the key operatingpersonnelpresently
employed
on the dredgingequipment.
-45Annex 4
Page 4 of 7
B. Aid to Navlgation
Introduction
9.
BIWTA is responsiblefor establishing,
operating,developing,and
waterways,except
maintaining
the aids to navigationsystemsin all Bangladesh
for the Portsof Chittagong
and Mongla. The Conservancy
and PilotageDepartment
of BIWTAmaintainsthe aidsto navigation
on all inlandwaterwayswith two buoy
tenders(onepresentlyout of service)and throughsevenfieldoffices,with a
by
collateral
duty to mark the channel. This latteractivityis accomplished
markmen
countryboatsand embarking
for the services
of nonmechanized
contracting
fromthe fieldofficeto mark the contourof the channelwithbamboopoles. In
order to improveand develop the aids to navigationsystem,GOB and BIWTA
ActionPlan by June 1993.
undertookto implementthe following
ReplaceAcetyleneLights
10.
Theaidsto navigation
systempresently
incorporates
acetylene
and
electric (solarpowered) lights from five manufacturersin four different
countries. This leads to confusionwith installation,
spareparts control,
inventories,
and orderingof spareparts. In orderto providea more reliable
and manageableaidsto navigation
system,about75 percentof lightingequipment
for minor lights(buoysand shorelights) will be convertedto electric(solar
powered)lightingsystemsfromone manufacturer.
Buoy Tenders
11.
The following
rehabilitation
and improvement will
the buoy tender,
be completed:
(a)
dry-dock and repair
(b)
dry-dock and repair the buoy tender, Pathfinder,
as required,and
panels;
replace its motor generator sets and distribution
(c)
developa vesseloperatingschedulefor docksidemaintenance
and drydockingon regularbasis and institutea diesel enginemaintenance
program; and
(d)
institute
internal
inspection
reports made to and corrections
Engineering Department.
Malancha;
programs for all buoy tenders,with
monitored by the Mechanicaland Marine
Telecommunications
to enhance
12.
Additional HF radio sets will be acquiredimmediately
the existing HF systems. Thirty HP transceiver setsalongwithotheraccessories
and spares should be purchased for BIWTA.
-46Aima. 4
?ag 3 'of 7
Distress
RadloFrequencies
frequencyshouldbe
distress
Monitoringof the international
13.
Monglaand Dhaka,wherethey
at Chittagong,
expandedto includethreelocations
for monitoringshot-dbe
can be monitored24 hours a day. The responsibility
under the Departmentof
to the InlandShip SafetyAdministration
transferred
shouldbe established
emergencies
for reporting
procedures
Shipping.Definitive
processingof emrgency messages.
to ensureexpeditious
InventoryControlSystem
controlsystemforallaide-to-navigation
inventory
A computerized
14.
both in the fieldand on shipsand in various
equipment,
and telecommunications
stores,will be established.
SurveyOperation
C. Nydrographic
Introduction
The annualworkloadof the BangladeshInlandWater Transport
15.
at presentin
Departmentcannotbe accomplished
Authority(BIWTA)Hydrographic
deficiencies.
of
equipment
a
result
as
placedon it mainly
view of constraints
survey
hydrographic
the
of
improvement
in the
Criticalfactorsto be considered
Hydrographic
the
to
assignment
vessel
survey
of
transfer
the
are
operations
vesselsand modernsurveyequipment.
of additional
and acquisition
Department,
surveycapabilityis
of hydrographic
The efficientutilization
16.
surveyvesselsare
The
vessels.
of
suitable
a
lack
by
currentlybeinghampered
of the shortage
because
and
Department
Pilotage
and
operatedby the Conservancy
of pilot boats, the survey vessels must be used in supportof pilotage
activities.GOB agreedthat surveyboatsbe assignedto, and operatedby, the
Department.
Iydrographic
Surveyeffortis severelyhamperedby lack of adequatevessel
17.
positioninginstrumentation.The DECCA system now in use is obsolete,in
constantneed of repair,and incapableof producingthe accuracyrequiredfor
surveys.
hydrographic
Control of the survey operationshould remain in Dhaka to
18.
and otherGovernment
Department
amongthe Hydrographic
communication
facilitate
agenciesand membersof the privatesectorwho are users of the information
providedby the Department. Threebranchsurveyo_ficesof the Hydrographic
for
reportingto the centralofficein Dhaka,shouldbe established
Department,
and
the Southwest(Khulna)and the Northeast(Ihairabazar)
the South (Barisal),
barge (seepara 19).
shouldeach be assignedone acconuodation
-47-
Annez 4
Pap 6 of 7
Equiip.mtImproweAmnts
19.
Operational
improvement
is dependentupon improvement
in survey
instrumentation
and vessels. The DECCA systemshouldbe replacedby modern
surveyinstrumentation.
Comprehensive
operational
and maintenance
training
must
be providedto realizethe fullpotentialof the equipment.In addition,the
surveyfleetis inadequate
to accomplish
the responsibilities
of the Hydrographic
Department.The followingrecommendations
will resolvetheseproblems:
(a) an improvedelectronicpositioningsystem should be provided in
1992/1993to replacethe existingDECCAsystemwhich has deteriorated
to the point where its usefulnessfor navigationand hydrographic
surveypurposesis negligible. The new systemwill not be tendered
until a studyof alternative
positionfixingsystemshas been carried
out and an adequate number of Global PositioningSystem (GPS)
satellites
havebeenplacedin orbitand are operational
so as to allow
at least 20 hours per day coverageof all parts of Bangladesh,
whicheveroccursearlier;
(b) the preponderance
of the boatsdesignated
as hydrographic
surveyboats
were built in 1966 and are frequently
down for repair. Theseboats
shouldbe removedfromthe surveyfleet;
Cc) the coastalsurveyvessel,Sandhani,shouldbe thoroughly
reconditioned
and assignedto the Hydrographic
Department;
(d) in addition to the three Dutch survey launches currentlyunder
construction,
six smallerinlandsurveyworkboats(10m lengthoverall)
shouldbe procuredand assignedto the Hydrographic
Department;
(e) threeaccommodation
barges(20m lengthoverall)shouldbe constructed
to providequartersand officefacilities
for surveycrewsto preclude
excessivetravelingtime to remotework areas;and
(f) maintenance
of the surveyfleetshouldremainthe responsibility
of the
Mechanicaland MarineEngineering
Department.To prevtent
unwarranted
down time, a scheduledmaintenanceplan for each boat should be
developedpriorto end of 1991by the Mechanical
and MarineEngineering
Department,
coordinated
with the Hydrographic
Department,
and strictly
adheredto.
Technicalspecifications
for the electronic
positionfixingsystem,hydrographic
surveyworkboatsand accommodation
bargesare in the projectfile.
Projected
Improvement Goals
20.
The average workload for B VTA, Hydrographic Department for the
last three years is usedas baselinedatafor the projected
improvement
goalsand
is shown below.
-48Annex 4
Pap
Post Hydrographic Survey Perfonrnuce,
PercentaCe of TarSet (1986 to 1986)
Target
Type of Survey
Inland Navigation
Dredging
Coastal Waters
Axis
Length
7 of 7
h
Actual
Axis
Sounding
Length
Length
2 of Target
Sounding
Length
3,751 km
29,458 km
1,306 km
351
4,761 km
162
239 km
11,803 km
135 km
56.52
5,612 km
47.6?
19,050 sq km
29,320 km
1,148 sq km
6?
1,866 km
6.42
Past and Projected HydrographicSurvey Performance,
Percentage
of Target - Axls LengthlSoun43ng Lebnth
Type of Survey
Inland
Navigation
Dredging
Coastal Waters
1/
1986-1988
1992
1993
1994
1995
35.02/16.0?
40/25
60/40
80/80
90/90
56.5Z/47.6Z
60/50
65/60
6-0/80
90/90
6.0Z/6.4Z
15/15
30/2S
70/70
90/90
Data obtained from BIWTA Project Proforma for Procurement
for Hydrographic
Survey, dated January,
1989.
of Water Crafts
-49Page 1 of 12
BANGLADESH
INLAND
WATER
TRANSPORT
PROJECT
BanglaJesh Inland Water Transport
BIlIC Strategic
Corporation
Plan
1.
BIWTCwas createdin 1972throughthe amalgamation
of 10 inland
vesselfleetswhichhad been abandonedat the timeof Bangladesh's
liberation.
The mandate of BITWC has been to operate this government-ownedfleet, no
specificstrategicobjectivehaving been established. Mounting losses
incurredby BIWTC has resultedin GOB questioningboth the rationale for
BIWTC, and the need for providing increasingsubsidiesto it. Over the years
BIWTC has, nevertheless,developedcertain key public serviceswhich are not
provided by private vessel operatorssuch as coastal passenger servicesto
offshore islands and the main ferry services. The corporationalso participates in other market segmentswhere it is in direct competitionwith
private operators,and in these BIWTC seeks to moderate the market, and
provide the governmentwith a minimum capabilityto transportessential
commoditiesin the event of emergencies.
2.
This strategicplan is based on various in depth analyses of the
BIWTC fleet and of private vessel fleets which provide ±-land water
transportationservicesin Bangladesh. Specificanalyseswhich support this
strategicplan include:
(a)
BIWTC Fleet Developmentand RationalizationStudy--preparedby
consultantsfrom the Universityof Newcastle-Upon-Tyne,
U.K.
(b)
BangladeshInland Water TransportMaster Plan, Chapter 6 (The Water
TransportFleet) - preparedby DlV ConsultingEngineers,the
Netherlands.
(c)
Cost-BenefitEffectivenessof BIVfC Fleet - preparedby the Institute
of Cost and ManagementAccountants,Bangladesh.
In addition, this strategicplan benefittedfrom numerous in-houseanalyses
carried out by the staff of BIWTC. The strategicobjectivesidentifiedand
addressed in this plan are set out below.
A. StrategicObiectives
3.
BIWTC's long-termobjectivewill be to:
"Becomea financiallyviable organization,and to concentrate
its activitiesin those sectors of inland water transportwhere
the Government needs to remain involved,i.e., the ferry
sector and the coastal passenger sector. The cargo sector in
which BIWTC now incurs a majority of its losses will be
graduallyphased out."
amex 5
-50-
Page 2 of 12
In support of the above long-termobjective,the medium-termobjective to be
accomplishedduring the Fourth Plan period (1991-1995)is stated as follows:
'For each distinctmarket segment in which BIWSC operates,
establish autonomousprofit centres which seek to become
financiallyviable over the next three years, with the
exception of thi coastal passenger servicewhere governmentis
requiredto provide non-economic(social)services,and for
this BIWTC should seek to achieve at a minimum a working ratio
of 1.0, i.e.,
its revenues including
direct government
subsidiesshould cover operatingcosts."
The profit centres referredto above are identifiedas follows: Coastal
Passenger Services;Inland Passenger Services;Cargo Services (Bay Crossing
and Inland);Ferries; and Repair Yards. Profit centres which do not achieve
the above medium-termobjective,will be divestedby BIWTC in fiscal year
1994.
B.
Perfornnce
of Market
Ses ats
4.
BIMTC operates the largest fleet of vessels in the inland water
transport sector. Out of a total of approximately2,100 mechanized cargo
vessels with a load capacityof around 410,000m.t., the BIWTC cargo fleet
accounts for around 400 vessels (of which only 160 are truly operational)and
these have a load capacityof around 75,500 m.t. In the passenger sector,
there are a total of around 1,450 mechanizedpassengervessels with a total
capacityof around 155,000 passengers. BIWTC's passenger fleet accounts for
around 43 vessels with a capacityfor around 8,300 passengers. Overall, the
BITC fleet represents,on a tonnage or capacitybasis, around 20 percent of
the total fleet in the cargo sector and around S percent of the passenger
where BIWTC
sector.
The above do not however include BIWTC's ferry operations
and the Roads and Highways Department ferry fleets
constitute
a virtual
public
sector monopoly. The followingparagraphsdiscuss the situationin each of
BIVTC's major market segments:
(a)
Coastal
Passenmer Services
5.
These are primarilypassenger servicesprovidedby the Governmentto
inhabitants
of the offshore
islands.
Very little
cargo is carried
and a lack
of shore facilitieson the islands precludescarriageof significantamounts
of cargo by the large mechanizedvessels (smallercountry boats provide cargo
services). Two major routes on
a these servicesoperate are: (a) Chittagong-Hatiya-Sandwip-Barisal
(Zl kn)t and (b) Chittagong-Uatiya(145 km).
On these two routes three very old vessels are used (A. Matin, A. Ahmed,
M. Haque) and on average these vessels suffer around 225 dayslyear off-hire
due to technicalproblems. In addition three other coastal vessels (Hatiya,
Nanpura, Bhola) provide serviceson lesser routes such as the KumiraGuptachara and Chittagong-Kutubdia
routes.
These vessels too are very old and
suffer from extremely low utilization
and service on the routes operated by
these vessels
tends to be extremely unreliable.
Four nevwr vessels
- Kajal,
Kutubdia, Rangabali and Moheshkhali - are nominally assigned to this service.
However, their high cost of operation preventstheir use and they have largely
been out of operation. The coastal passenger service contributesabout 4
percent to total revenue. The sector incurs continuouslosses as shown in
Table 1.
-51-
Annex 5
Page 3 of 12
Table 1s PROFIT AND LOSS STATUIMNTFOR COASTALPASSENGERSERVICS
1984
1985
1986
1987
1988
---------(MillionTaka)-----------Revenue
Direct Costs
IndirectCosts
Depreciation
Interest
Total Costs
Loss
12.2
18.5
5.3
1.6
0.4
25.8
(13.6)
12.2
12.5
13.6
12.0
14.9
19.4
20.0
17.4
4.1
6.6
7.9
8.3
1.8
1.8
1.9
1.8
0.4
0.4
0.4
0.4
21.2
28.2
30.2
27.9
(9.0) (15.7) (16.6) (15.9)
Revenue from this sector is not even adequate to cover direct operating costs,
and net losses have, in most cases, exceeded the revenue generated. Since
this is a socially justifiablesector with no private sector operations,
continued operationwould be justifiablewith direct subsidy from the
Government.
Improvements in service performance is necessary
and would
require replacement
of the vessels
currently
being utilized
on these routes.
New coastal
passenger
vessels
should have a capacity of around 750 passengers
and 100 tons of cargo
and the fleet should be able to provide daily service.
(b)
Inland
Passenger
Services
6.
Revenue from this sector reached a peak in 198586, and has dropped
considerablysince then. In 1988, the sector contributedonly 5.3 percent of
total revenue of BIVTC (see Table 2). As in the coastal passenger service,
revenue from this sector does not cover direct operatingexpenses, and losses
have doubled between 1984 and 1988.
Table 2Z PROFIT AND LOSS STA^TUXITOF TSE INLAED PASSENGER SICTOR
1984
1985
1986 1987
1988
----------(MillionTaka)-----------Revenue
Direct Costs
Indirect Costs
Depreciation
Interest
Total Costs
Loss
9.7
26.0
14.5
25.1
4.2
8.3
0.8
4.9
0.5
4.6
20.0
42.9
(10.3) (16.9)
28.6
17.0
15.1
28.9
23.2
19.9
11.5
10.5
10.6
6.0
6.3
4.8
0.4
0.0
0.0
46.8
40.0
35.3
(9.2) (23.0) (20.2)
7.
The Dhaka to Rhulna Rocket Service is the main inland passenger
service provided by BIVTC. Of the eight vessels
used on the rocket service,
only Gasi and Tern appear to have a reasonablelevel of utilization.
Madhumati and S. Belayetwere off-hire for over 300 days in the past year,
E#en Gazi and Tern had around 130 days off-hire. The other four vessels
(Kiwi, Lepcha, Mahsud and Emdadul)are hardly ever in service.
-52-
Annex S
Page 4 of 12
8.
Analysis of the Rocket service indicatesthat six of the eight vessels are candidatesfor scrapping.Re-enginingof Gazi and Tern may be
considered. However, the condition of the hull for these vessels is so poor
that this may not be worthwhile. In view of the serious lack of capacity in
the inland passenger sector, and the very large number of accidents caused by
overloadingof passenger vessels, the Governmentshould consider replacingthe
BIWTC fleet with 3 inland passenger vessels to operate on the main trunkroute
Dhaka-Barisal-Khulna.Financialviability on this route can be achievedby
(a) raising tariffs by 50 percent above current levels; and (b) improving the
operationalperformanceof the vessels in this service.
(c)
Day Crossing Carso Services
9.
The bay crossing cargo sector contributesabout 42 percent to the
total revenue of BIWTC. This sector,which includestankers for petroleum
products, coasters for bulk cargo, and bay crossingtug barges has the
potential for operatingprofitably, (see Table 3). This sector made marginal
profits in 1984 and 1985, and minor losses from 1986 to 1988. It was,
however, able to cover cash operatingcosts in these years (i.e., all costs
except depreciation). With some improvementsin productivitylevels (e.g.,
lower turnaroundtime) and operationalefficiency (fuel efficiency),this
sector could make a reasonablesurplus.
Table 3: PROFIT AND LOSS STATSIENTOF THE BAY CROSSINGCARGO SECTOR
1984
1985
1986
1987
1988
--------- (MillionTaka)-----------Revenue
Direct Costs
IndirectCosts
Depreciation
Interest
Total Costs
Profit/Loss
124.7
78.2
24.6
11.8
5.7
120.3
4.4
145.9
96.8
26.9
12.0
3.6
139.3
6.6
116.2 114.6 117.9
77.9
76.6
75.8
29.3
31.9
37.5
11.9
12.0
11.3
2.6
1.9
1.8
121.7
122.4
126.4
(5.5) (7.8) (8.5)
10.
Tankers. Twelve tankers each of deadweightcapacity 900-1,000m.t.
make up the BIWTC tanker fleet. Primarilythese vessels are used for carrying
petroleum products from Chittagongto points inland. The analysis indicates
that fleet productivitycould be improvedby a factor of 2 to 4 times current
levels. Presently,BITRC tankers spend 150 to 170 days per year (on average)
out of operation,and when in operation spend around 6 idle days per voyage
waiting for cargo or to unload cargo. With reasonableproductivity,the work
of this fleet could be accomplishedwith just 7 tankers.
1!.
Coasters. This is a potentiallyprofitablesector for BIWTC.
Typic-lly,these 18 vessels carry bulk cargo from Chittagongto inland
destinationssuch as Dhaka. The fleet appears to bave a ,- sonable level of
productivitywith the exception of around 7 vessels which have a high level of
days off hire (about twice that of the rest of the fleet). The analysis
-53-
Anne: 5
Page S of 12
indicatesthat twelve of these vessels are currentlyprofitablefor BTWTC,
though their operationalperformancecould be improved. The remainingvessels
(Bagabati,Hisla, Kasalong, Kocha, Soraiya,Tazul Islam and C-1066) are to be
disposed off.
12.
Bay Crossing Tug-Barges. Performanceof this fleet of 35 barges and
6 tugs is extremely poor. Typicallyeach barge makes 4 to 5 loaded trips per
year, whereas 12 loaded trips per annum would be the minimum acceptablelevel
of utilization. Each tug makes on the average only 13 round trips per year
comparedwith coasterswhich make on average 20 round trips per year. Four
tugs with, at the most, 16 barges should be adequate for the work of this
fleet. Therefore, it is recommendedthat two tugs (Sadaftand BT-238), and 19
bay-crossingbarges be disposedof.
(d)
Inland Cargo Services
13.
Revenue from the inland cargo sector dropped from Tk 27.9 million
in
1983184 to Tk 14.9 million
in 1987/88,while total costs increased from Tk 63
million to Tk 83.0 million. Losses at the end of the year from this sector
were Tk 68.1 million, i.e., 89 percent of total BIVTC losses, although it
contributedonly 5 percent of total revenue (see Table 4).
Table 4s PROFITANDLOSS STATUMCITOF TUE IMLANDCAMGO
SDCTOR
1984
1985
1986
1987
1988
----------(MillionTaka)----------Revenue
Direct Costs
Indirect Costs
Depreciation
Interest
Total Costs
Profit/Loss
27.9
39.2
29.9
19.2
14.9
42.2
55.1
56.7
39.2
43.4
13.0
16.5
23.1
19.4
24.7
4.5
7.3
7.7
6.6
6.3
3.3
6.3
8.7
8.6
8.6
63.0
85.2
96.2
73.8
83.0
(35.1) (46.0) (66.3) (54.6) (68.1)
14.
Self PropelledBarges. Eight self-propelledbarges are operatedby
BIWTC, and of these 3 are very new vessels (the Annataris built in 1984). The
older five vessels are of 1930 vintage or older. Presently,all of these
vessels suffer from extremely low productivity. On a typical voyage they
spend around 16 days waiting for loading/discharge
to comence. In addition,
the typical older vessels spends 180 days per year out of operation
(correspondingfigures for the Annataris is 65 days). It is therefore
recommendedthat the five older vessels be disposedof.
15.
Inland Tug-Barges. BZVTC's inland tug-bargeoperation is probably
the worst of all of the fleet segments. It is estimatedthat out of just
under 200 barges involvedin this operation,only 90 are actuallyearning
revenues. Further,among the 90 odd revenueearning barges, performanceis so
poor that it is estimatedthat the operationallybest 16 barges could carry
all of the cargo now being carried. The followingsumnarizesthe operational
performance:
-54-Atx
Annex 5
Page 6 of 12
- 16 best (newer)bargesmke 6 to 7 tripslyear;
- 32 mediumconditionbargesmake 3 to 4 tripslyear;
- 45 olderbargesmake 1 to 2 tripsper year;and
- the remainingbarges are idle.
Around40 inlandtugsare utilizedby this fleetof barges,and it is estimatedthata fleetof 10 tugs and 40 bargeswould be adequateto the current
needs,and henceshouldsufficeto fulfillthe Government's
minimum
requirements.
(e) FerryServices
16.
Ferriescontribute
44 percentof the revenuesof BIWTC (up from 34
percentin 1983/84,see Table5), and of this the Aricha ferries(ArichaNagarbari,
Aricha-Daulatdia)
aloneaccountfor over 90 percentof ferry
earnings. The other importantferryis the Bhuapur-Sirajganj
ferry. In
general, the ferryoperationsgeneratea positivesurplus. However,if
interest payments and depreciation are considered, the newer ferries are not
breaking even.
Table5S
MM011?
AND LOSS STATUENUT01 THE FERY SCTOR
1984
1985
1986
1987
1988
----------(MillionTaka)------------
Revenue
DirectCosts
IndirectCosts
Depreciation
Interest
TotalCosts
Profit
92.9
41.0
12.7
5.9
2.6
62.2
30.7
97.3
45.1
12.9
6.6
1.5
66.1
31.4
120.6
47.8
20.2
11.1
4.6
83.7
36.9
119.5 123.8
50.4
48.7
23.5
26.1
11.6
8.3
4.7
4.2
90.2
87.3
29.3
36.5
17.
The analysis indicates that the Dhakaclassferries suffer from high
fuel consumption and these 4 vessels may be disposed of. Also, the
performance of thesevessels,Sitalakhya,
Karnafully,
Goraiand Gumti indicate
thatthey are candidates
for scrapping.The strongdemandin this sector and
difficulty
in recovering
full coston the never ferries,suggestthat the
Government
may considerinvestment
in additionalferriesif this is
accompanied
by a substantial
increasein tariffs.
(f)
RepairYards
18.
BIVTCoperates repair yards in Ihulna, Narayanganj, and Dhaka.
Althoughdetailsof the operations
of theserepairyardsare not known,they
are mostlyin a stateof disrepair,
and do not provideadequatefacilitiesfor
rehabilitation
of DITC's vessels.
The currentoperationof the repairyards
is that they are treatedas an overhead of vesseloperations,
wherebytheir
costsare allocatedto the other sectors arbitrarily
on the basis of the other
operatingcosts. Thereis, therefore,
no financialstatements
on the
operations
of the repairyards.
-55-
Annex 5
Page 7 of 12
C. Prosed Scrappin8
Progra
19.
The Government
has embarkedon a scrappingprogramwhichwill
eliminatevesselsin poor conditionfrom the BIWTCfleet. In selectingthe
vesselsto be disposedoff, the emphasishas been on the conditionof the
vessel,ratherthanon its economicperformance.It is estimatedthat around
160 vesselswill be scrappedreducingthe currentfleetfrom over 400 vessels
to around300 vessels. Sincethisvesseldisposalprogramis determined
primarilyby the conditionof the vessels,the remainingfleetexhibits
certain imbalances and also may not be optimal from the view point of JIWTC
operational
requirements.
A further rationalization
of the fleet (see below),
particularly
the inlandcargofleet,will be calledfor in the near future.
Thiswill aim at balancingthe fleetand also graduallyeliminating
those
operations
whereBIWTCstandsto losemoney.
D. FinancialPerforanceof IWTC
(a)
Profitability
20.
The financialperformance
of BIWTChas been deteriorating
steadily.
From a deficit(afterinterestand depreciation)
of about4.9 millionTaka In
1983184,the deficitin 1987/88stoodat 56.6millionTaka. Further,if
had fullyreflectedinterestdue, the
interestchargeson existingobligations
deficiton 1987/88wouldhave exceeded80 millionTaka. At the end of FY88,
accumulated
lossesamountedto 218 millionTaka. From draftunaudited
statements,
it is expectedthat for the year1988189,the deficitwill more
accumulated
lossesto
than doubleto around120 millionTaka,thus increasing
more than 330 million Taka. This sharp increase In the deficit is largely
attributed
to increases in depreciation charges on newly acquired vessels and
increases in staff costs.
(b)
Liquidity
and RevenueCollection
21.
Although the current ratio seems favorable, BIWTC's liquidity
position is characterized
by largeamountsof outstanding accounts
receivables,
someof whichhave been outstanding
since1977. As of June 1988,
outstanding receivables amounted to 171 million Taka. Table 6, which shows
of the situation.
the average collection
period, demonstrates the seriousnes
The averagecollection
periodwouldbe higherif revenue from the cash market
segments,i.e.,ferries, passengerservices,is excludedfrom the analysis.
Out of the totalreceivablee
in 1987/88,about88 millionTaka (or 51.3
percent)is owedby otherpublicinstitutions
and Governmentdepartments.
by largeamountsof accumulated
BIWTC'scurrentliabilities
are characterized
interest((176.2millionTaka)payableon both government
and foreigndebt.
the debt itself)by BIWTCseemsunlikely
Paymentof theseamounts(including
with the currentfinancialsituation.
A
Page 8 of 12
-56-
Table Gs ACCOUNTS
REceIVsJIS
Total Accounts
Receivables
(M Taka)
Total Revenue (M Taka)
Accounts Receivables
as
a 2 of Total Revenues
Average Days Collection
(c)
1983184
1984185
163.9
301.8
155.7
356.8
542
197
44Z
161
ANALYSIS
1985186
152.7
341.7
452
164
1986187
1987188
160.6
303.9
171.4
313.3
53Z
193
552
201
Capital Structure
22.
BIWTC's capital structure consistsof Governmentgrants, equity and
long-termdebt. The ratio of long-termdebt to total capital has been low,
due to a Governmentdecision to convert some debt into equity in 1984185. The
size of long-termterm debt, has, however, been accumulatingover the years,
with little or no repaymentsmade. In the current position, BMTC is unable
to take up any new debt to finance capital investments,unless the Government
intervenes. Any future investmentwill therefore require substantial
restructuringof the existingcapital structure,involvingreschedulingof
some portionsof existing debt to enable BIWTC to undertakemore investments.
U. Future linacial Perforuauce
23.
At its current level of operations,BIlST is likely to remain a drain
on Governmentresources,unless substantialimprovementsare made in its
financialstructure,operations,and policy objectives. Further investments
in new equipmentand/or vessels,without accompanyingimprovementswill result
in increasedlosses, and insolvencyin a matter of a few years as illustrated
by the analysis of two scenariospresentedbelow.
Case Is Continue to operate BIWTC as at present. This analysisassumes that
BIVTC will continue to operate all cargo, passenger and ferry sectors. The
only new investmentsin this analysisare the ferrieswhich are
already committedunder a grant from DANIDA. The investmentcost for these
ferrieshas been estimated at US$15 million (approximatelyTaka 657.0
million). Existing debt is assumed to be rescheduledover twenty years,
beginning from FY90. The analysisalso assumes the implementationof the
scrappingprogram,which has already been agreed upon. Outstandinginterest
payable Ls assumed to be converted into equity in 1989/90. The financial
projectionsfor this scenario shows net losses increasingto Tk 169.2 million
by the end of financialyear 1997/98,and cash losses accumulatingto Tk 1.2
billion. BIVTC will be insolventby 1995.
Case MIl Achieve better financialand operationalperformancethrough tariff
increases,cost reductions,fleet restructuring,surplus labour reductions,
and improved fuel efficiency. This analysisassumes that BIVTC will implement
tariff
increases
on the ferry and passenger sector, in two phases over a four
-57-
5
Page 9 of 12
jawsko
year period. Thesefare increasesare justifiable
sincepassengerfareshave
not been adjustedsince1982. (Ferrytariffswere adjustedby 10 percentin
1988,despitea decisionto increasethemby 50 percent).This analysis
furtherassumesan investment
of US$60million(Tk 1.9 billion),over the next
fiveyears. It shouldbe notedthat the investment
of US$60millionis the
most that BIWTCcouldundertakewith the proposedchanges. Any investments
higherthan this amountwould increaseBIWTC'sdebt serviceliabilityto
unmanageable
proportions.BIWTC'sexistingdebt is alsorescheduled
over
twentyyears,and outstanding
interestpayableis convertedintoequity. The
performance
of BIWTCunder this scenarioshowsprofitsbeginningin 1993194,
and BIWTCbeingable to serviceboth existingand futuredebt obligations.
F. StrategicPlan
24.
To becomefinancially
viableover the next fiveyears,BIWTCwill
need to introduceimportantchangesin its operations,
finance,organization
and manpower. The followingparagraphsset out key elementsof the strategic
plan.
(a)
Organizational Restructuring
25.
It is recommended that BIWTCestablish
five autonomous profit
centres, each of which is capableof operatingindependently.
Thesewill
consist of the profit centres referredto in previoussections,i.e.,Coastal
PassengerServices;InlandPassengerServices;CargoServices(bothbay
crossing and inland); Ferry Services;and RepairYards. Each of thesewill
have adequatestaffto manageits operations,
and will be expectedto become
financially
viablewithinthreeyears. This restructuring
will assistin
ensuringtransparency
withineach profitcentre'soperations,
and will avoid
unintended
cross-subsidization.
The repairyardsare alsoexpectedto operate
as a profitcentre,to which each of the others(andoutsidefleetoperators)
may contracttheirrepairwork basedon competitive
bidding. Thiswill
ensurethatthe othersare not chargedan arbitraryoverheadcost for repairs,
regardless
of whethertheyhad repairsdoneor not. For coastalpassenger
serviceswhere the governmentis requiredto providenon-economic
services,
the directsubsidies
will be neededat a levelof aboutTaka10 millionper
annumat currentprices. If financial
viabilityis not achievedin certain
profitcentres,thesewill be divestedin FY94. Technicalassistance
under
the IWT III projectwill be providedto eachof the profitcentresin the form
of a teamof ManagementConsultants
for a periodof 4 years. The Management
Consultants
will be assistedby BIWTCcounterpart
personnel,
who will be
trainedto assumeresponsibility
at the end of the managementassistance
programme.Thesemanagerswill assistin staffing,operations,
financial
management,
fleetdevelopment,
and stafftraining.
(b)
FinancialRestructuring
26.
This will consist of a capital restructuring,
a rationalization
of
the magnitude of BIWTC's accounts receivables and improvement of its revenue
collection
procedures.
-58Paso 10 of 12
27.
CagitalRestructuring.As of June 1988,totaloutstanding
debtowed
by BIVTCincludingoutstanding
interestamountedto 899.1millionTaka. It is
obviousthatBUMTC is unableto repaythe amountin its presentcondition.If
new investments
are undertaken,
chisdebt serviceliability,
includingdebt
serviceliabilityfor the new investments,
will put BIWTCinto further
financialdifficulties.It is thereforeagreedthatthe Governmentapprove
rescheduling
bIWTC'sexistingdebtover a periodof 20 years,beginningfrom
1991/92with an effectiveinterestrateof 9 percentp.a.,and converting
outstanding
debt and interestpayableto equityso as to adjustfor any
differencein the interestrateestablished
fromthe presentweightedaverage
interestrateof 9 percenton existingdebt. Coupledwith other improvements
and changes,BIWTCshouldbe able to serviceexistingdebt,and futuredebtof
aboutUS$60million.
28.
AccountsReceivables
and RevenueCollections.The collectionof
outstanding
accountsreceivableis a majorproblemfor BIWTC,whichhad
outstanding
accountsreceivables
of Tk 197.9millionas of end 1988. BIWTC
doesnot have an internalmechanismto enforcecollectionfromgovernment
ministriesand agencies(whichmake up about50 percentof totalaccounts
receivables).For commercial
arrears,therehas been no efforton the part of
IWTC to develop a debt collectionprogram of any kind.
29.
The centralissuehas beenclaimsfor shortagesof cargocarriedfor
Government
departments.More thanhalf of BIWTC'saccountsreceivables
representtheseclaims,and clientshave suspendedpayment,untilthe claims
are resolved. It is recommended
that the concernedGovernmentdepartments,
togetherwith BIWTC,reviewthe contractsunderwhich the cargois carriedto
revise6 v provisionsthat unfairlyburdenseitherparty. A procedureshould
also thenbe developedto collectdebtsdue fromothergovernment
departments.
For any debt that cannotbe reconciled,
BIWTCshouldwrite it off in FY92.
30.
For privatesectorcommercial
receivables,
BIWTCshouldfirstset up
an effectiveprogramfor promptinvoicing
and collection
of accounts
receivables,
and also developa writtenpolicycoveringthe basisfor the
grantingand repaymentof credit,includingtermsof repayment,security,
etc.
For existingdebt,BIWTCshouldreconcile
all outstanding
accounts,and
resolveany discrepancies.Collection
methodsfor theseshouldinclude
rescheduling
of some longoutstanding
receivables
overan agreedfixed
paymentsschedule.BIWTC shouldalsoprohibituse of its facilitiesif the
agreedrepaymentscheduleis not being followed,
unlesscash paymentis
possible.
(c)
FleetRestructuring
and Rehabilitation
31.
As indicatedearlier,with the exceptionof the ferryand passenger
sectors,BIWTCcan carryouL its presentrolewith a substantially
reduced
fleetof vessels. Table7 setsout a fleetrestructuring
plan for the years
FY91-95. The proposedrestructuring
programreducesfleetsize in linewith
(productive)
requirements
in eachmarketsegment. Selectedvesselsfromamong
the vesselsto be retained,will be designatedfor rehabilitation.
The vessel
rehabilitation
programwill be allocateda totalbudgetof US$3.5million.
The ManagementConsultants
appointedunderthe projectwill developan optimal
fleetrehabilitation
programwithinthe limitsimposedby the available
budget.
-59Pag 11 of 12
Table 7:
IRTC FLEETEESTRUCTUISPLAN Y1192-FY94193
In th
Fleet
192
F93
F94
6
6
0
2
8
Numberof vessels
Fleet
Se
ant/Vessel
Type
A. Coastal Service
1. CoastalPassengerVessels
- Existing
- New
2. Sea Trucks lb
D. Inland Passenger Service
3. InlandPassengerVessels
- Existing
- New
Ei.tinglcc
FY91
16
26
11
10
9
2
2
8
17
16
15
12
10
17
10
10
6
2
0
1
2
3
10
6 1l
FY95
17
10
1O
7
4
3
22
18
18
16
16
16
2
18
2
18
C. Ferry Services
4. ROIRO Ferries
- Existing
- New
22
18
18
2
18
12
20
6
35
73
7
13
5
35
60
7
12
5
30
54
6
11
4
25
46
6
10
4
20
40
5
10
4
16
35
12. Miscellaneous
Vessels
8
41
235
284
50
3
23
148
174
38
3
19
125
147
35
3
15
l00
l1
2
3
12
70
85
30
3
10
40
53
28
Total Fleet
472
317
280
236
189
147
D. Day CrossingCargoServices
5. Tankers
6. Coasters
7. Bay CrossingTugs
8. Bay CrossingBarges
S. Inland Cano Services
9. Self Propelled Barges
10. InlandTugs
11. InlandBarges
Ia FournewerLCT'snot now beingused shouldbe disposedoff.
all vesselnumbersreferto existingvessels.
lb Unlessotherwiseindicated,
/c As of 1989.
(d)
Monvoer Rationalization
32.
BIWTC'sfleetrestructuring
programmeoutlinedin the tableabove
will resultin surplusmanpowerof about2,200people. 1,200surplusstaff
in the IfT sector.
to dutiesin otherorganizations
shouldbe reassigned
and eachcouldabsorbabout
Department
of Shippingand BIWTAare understaffed
600 surplusBIWTCpersonnel.About1,000of this surplusstaff(thosewith
less than5 yearsremainingservice)will be giventhe optionof early
retirement
with full benefitsover a periodof 5 years. It is proposedthat
the cash (aboutTk 100 million)will resultin a cost savingof about30
percenton the totalwage costsof BIWTC.
-60Amex: 5
PaSe 12 of 12
(e)
33.
(para 25
services,
adjusted
provided.
(f)
CoastalServicesSubu.LdI
The cost of publicserviceobligationis estimatedat Tk 10 million
above) will be given by GOBto BIWTCas paymentfor providing coastal
starting in 7Y91192. In subsequent
years,the amountwould be
to reflectinflationand any changesin the levelof service
Facilities
ImPovemnt
34.
To improveoperational
efficiency
of the variousprofitcentres
miscellaneous
equipmentwill have to be procured,and improvements
made to
existingfacilitiesof BIWTC;thiswould includefuelmonitoringsystems,
telecommunications
equipment(30 HP transceivers),
vehiclerecoverycranesfor
ferryoperationsand cargoweighingscales. Thereis also a need to improve
BIWTC'sofficefacilities,
and thesewould be includedin the proposed
project. The totalbudgetfor facilities
development
would be US$2.8million
equivalentand the Management
Consultants
appointedunderthe projectwould
developa list of facilities
development
needs that fitswithinthis budget.
(g)
Tariffs
35.
A tariffincreaseof 70 percenton the ferriesand 50 percentin the
passengersector,implemented
in stagesover the periodFY91 to FY95with an
initialincreaseof 45 percentin the ferrysectorand 25 percent in the
passengersector,exceptdeckclasspassengers
where the increasewouldbe 10
percent,to be implemented
by March1991. BIMTCwill be allowedto compete
freelywith privateoperatorsin the cargosector.
-61Amnex6
Poge 1 of 7
THIRD INLANDWATER
TRANSPORT
PROJECT
Institutional
Development
ActionPlan.
here are based on the
development
actionsrecommended
1.
Institutional
of four reportsproducedin preparation
for this project.
recommendations
Project,Analysisof Waterway
(a) Bangladesh
- ThirdInlandWaterTransport
Arlington,
Virginia,May 1989.
Institutions;
WaterResourcesCongress,
(b) Bangladesh- Third Inland Water TransportProject,Report of the
WaterResources
Congress,
Planning;
SpecialTaskGroupon Organization
Arlington,Virginia,December1989.
(c) Bangladesh- Third Inland Water TransportProject,Report of the
Special Task Group on Training; Water Resources Congress, Arlington,
Virginia, December 1989.
(d)
ILO mission report on "Training Component for the Third Inland Water
Transport Project,"
by J.Z. Fikus (ILO, Geneva) and 0. Schouten (ILO,
Regional Office for Asia and the Pacific, Bangkok), November 1989.
actionsand
The abovereportsare availablein the projectfiles. Recommended
programsare alsobasedon detailedreviewsby IDA missionsand on discussions
needsand possibilities.
development
with the Governmenton institutional
2.
The Ministryof Shipping(OS) of GOB is responsible
for all Government
functions in the inland water transportsector. It dischargesthese
throughthree agencies,namely,the BangladeshInlandWater
responsibilities
TransportAuthority(BIWTA),BangladeshInland Water TransportCorporation
(BIWTC),and the Departmentof Shipping(DOS). The first two are autonomous
entitieswhich are expectedto be 3elf-financing.BIWTA is responsible
for
maintaining all waterway infrastructure
including channels, inland ports avad
other public facilities.
BIWTCoperates a fleet of vessels providing ferry
services,
inland and coastal cargo services,and inlandand coastalpassenger
services.
DOSis responsible for most of the regulatory and trainingfunctions,
thoughin someareas,its mandateappearsto overlapwith thatof BIWTA.
A.
Bangladesh
InlandWaterTransportAuthority
3.
BIWTA'sboardconsistsof a Chairman,effectively
the chiefexecutive,
and fiveotherBoardmembers,includingthe Membersof Engineering
and Finance
by the Government,
who are fulltimemembers.The Boardis appointed
Departments
(throughthe Ministryof Shipping)and is responsible
for approvalof staff
appointments,
salaries,developmentand revenuebudgets. The Ministry of
Shipping'sinvolvementin BIWTA'sdaily operationsand the concentration
of
decisionmakingat thehighestlevelsof management
are impediments
to efficient
-62AnneX 6
Pag 2 of 7
operation. The BIWTA chairman also heads an advisory committeewhose
responsibilities
includeadvisingusers of the waterways (both privateand
public)on all mattersrelatingto the development,
maintenance
and operation
of
inlandwater transportin Bangladeshin particular,
dredgingactivities.
4.
BIWTA'sorganization
structure
consistsof elevendepartments
of which
the operational
departments
are: (a) Portsand Traffic,(b)MarineEngineering,
(c) Conservancy
and Pilotageand (d)Hydrography
Department.Thesedepartments
are responsiblefor waterwaysmaintenance,
conservancy,
shoresidefacilities
development,
dredgingand controlling
the activities
of publicand privatesector
vesseloperators.The othersare supportdepartments,
including
Administrative,
Accounting
and Finance,and the Secretariat.
5.
As of January31, 1990,BIWTAhad a sanctioned
staffof 3,978of which
approximately3,125 positionswere filled. Out of the total sanctioned
positions,
3,367were in the operational
departments,
whilethe remaining
were
in Finance,the Secretariat
and the Dock PersonnelTrainingCenter. Like other
publicagenciesin Bangladesh,
the organization
structure
of BIWTAwas set up by
the Enam Committee,which was commissioned
to assessthe staffinglevelsof
publicagencies. BIWTA feels that althoughthe sanctionedstafflevelsseem
adequate,there are seriousstaff shortagesin some areas,especiallyin the
Conservancy
and Pilotage(C & P) Department. With the increasein waterway
trafficoverthe years,and with the deterioration
of ehannelconditions,
the C
& P Departmentis overwhelmed
and needs additional
people. Thereis also lack
of managementskillsat all levelsin most departments,
especiallyin planning,
financeand accountingdepartments. Therefore,BIWTA manpowerneeds to be
increased,
particularly
in the C & P Department.Thereis alsoa needto improve
managerialand technicalskillsof seniorstaff throughappropriate
training
programs.
Inatitutional
Weaknesses
6.
Institutional
weaknessesidentified
in the currentBIWTAorganization
are as follows:
(a) Responsibility
for dredgingoperationsis fragmentedamong the Chief
Engineer, the Chief Mechanical and Marine Engineer, and Conservancy and
Pilotage Department.
This results in an inadequacy in the chainof
commandand leads to operational
inefficiencies.
(b) Tariffmakingauthority
of BIWTAis weak, and enforcement capability
practically
non-existent.
is
(c) Directorate
of Conservancy
and Pilotageis understaffed
and therefore
finding difficultyin meeting its obligations;out of a total
sanctioned
strengthof 1,583,the Directorate
is short230 staff.
(d) PlanningDirectorate
similarly
is veryunderstaffed
and needsto double
in size from33 staffto around65 staff.
(e) Design approvalfor inlandvesselsis presentlycarriedout by the
staffof the ChiefMechanical
and MarineEnjineer,and it is feltthis
responsibility
wouldbe betterfulfilled
by the Department
of Shipping
-63Amnix6
Pap 3 of 7
of
and registration
certification
whichis responsible
for inspections,
vessels.
(f) The BarisalWorkshopsof BIWTAare barelyoperational
and all of the
staffthereare likelyto becomeredundant.
(g) The DeckPersonnelTrainingCentrewhichis presentlyunderBIWTAcould
be betterintegratedintothe Government's
overalltrainingapparatus
if this too were placedunderthe Departmentof Shipping.
and thisis
an actionplanhas beendeveloped,
Basedon the aboveobservations,
paragraph.
set out in the following
BIWATInstitutional
GO. will
7.
Development Action Plan
undertake the following
actions
with respectto BIWTA:
(a) Establisha Dredging Unit reportingto the Hember Engineering dredging staff presentlyassigned to the Chief Engineer,Chief
Mechanicaland Marine Engineer,and to the Conservancy
and Pilotage
Department,
shouldbe transferred
to thisunit;
(b) Terminateall activitiesrelatingto the settingof cargotariffsfor
IVT. Cargotariffswill be deregulated
by the Ministryof Shipping.
(c) Absorbat least600 stafffromBIWTCto mate up the overallshortfall
of stafffrom sanctioned
strengthand to reducethe surpluspresently
existingin BIWTC (seepara 12 below)--ofthese,230 staffare to be
assigned to the Directorateof Conservancyand Pilotage,and an
additional30 staffare to be assignedto the Directorate
of Planning
(the lattershouldbe recruitedfrom BIWTC'sComuercialDepartment),
any conflictwith regardto specificstaffwill be resolvedby the
Secretary,
MOS, or his designate;
(d) Transferthe BarisalWorkshopsto BIWTCwhere it will becomea partof
BIWTC'sship repairprofitcentre;
together
(e) Transferall inlandvesseldesignapprovalresponsibilities
withassociated
staffresources
to the Department
of Shipping,
uponthe
establishment
of the new 'InlandShip SafetyAdministration;,
(f)
BIWTAwill appoint a member for planning and operations
Directors;
and
to its Board of
(g) Transferthe Deck PersonnelTrainingCentreto DOS.
priorto the mid-termreviewof the
All of the aboveactionsare to be completed
projectwhichwouldbe carriedout by June 1993.
-64Arnie 6
Pap 4 of 7
B.
Bangladesh Inland Water Tranport Corporation
8.
The Bangladesh
InlandWaterTransportCorporation
(BIWTC)was created
underPresidential
orderNo. 28 of March1972,mainlyto takeoverthe operations
of inlandwater transportservicesin Bangladesh,
afterthe war with Pakistan.
At the time, there were about 10 private sector inland water transport
corporations,
abandoned
by Pakistani
and foreignowners,whichwerenationalized
for a wide
by the Governmentof Bangladesh. BIWTC thus became responsible
varietyof watertransport
operations
rangingfromcargotankerservices,inland
tug and barge operations,
passengerserviceson inlandwaterwaysand between
mainlandports and offshoreislands;and ferry servicesacrossmajor inland
are in Annex 5.
waterways.Detailsof BIWTCoperations
eachheaded
9.
BIWTChas fourmajordepartments
reporting
to the Chairman,
by a director. These departmentsare, namely: Finance;Administration;
and Commerce,Sales and Services. The existing
Maintenanceand Operations;
organization
is not well structured
and shouldbe streamlined
and rationalized,
and the Commerce,
particularly
in the Maintenanceand OperationsDepartment,
Salesand ServiceDepartment,where responsibilities
overlap. As an example,
and Operation
Department
whilefleet
operational
staffare underthe Maintenance
scheduling
is controlled
by CommerceSalesand ServicesDepartment.
As a result,
day to day operations require tie joint authvirtw.ation of both departments, which
causes delays, loss of runningtimeand otheroperatingproblems.In addition,
the linesof responsibility
in the Directorate
of Commerce,Salesand Services
as theyhaveto reportto separateheadquarters
for zonemanagersare ambiguous,
for a fullmix of
managers.It is alsocommonto findzonemanagersresponsible
services, e.g., ferry, inland cargo, passenger services,which clouds
responsibility,
and reducesaccountability..
Theseissuesare being addressed
of the Strategic
Plan,
restructurinb
undertheprojectthroughthe organizational
with the formationof profitcentersfor ,achservice.
10.
As of March 1989,totalsanctionedstaffof BIWTCwas 7,792while the
postedstrengthwas 5,932. The distribution
of thesestaffamongthe various
departments
was as followstAdministration
- 240;Finance- 393,Maintenance
and
Operations- 6,484 and CommerceSales and Services- 675. This staff level was
by GOB to assessthe minimumstaffingneeds
proposedby a committeesanctioned
of all publiccorporations.
Discussions
with BIWTCmanagement
indicatethatthe
do not reflectits staffneeds,and thatgenerally
staffingleveland structure
and
BIWTC is overstaffed. In addition,the qualityof planning/budgeting,
BTWTC
staff(witha few exceptions)
is poor,and needstrengthening.
accounting
has usuallybeenfundedon an
doesnot have a formaltrainingprogram. Training
ad hoc basisby bilateraltechnicalassistance.Underthe proposedproject,a
of some
involving
the redeployment
staffretrenchment
programwillbe implemented
in the IUT sector[seepara 12 (b)].
staffto otherinstitutions
Institutional
Weaknesses
11.
are:
Institutional
weaknessesidentified
in the currentBIWTCorganization
(J,
othersincur
are profitable,
Whereascertainpartsof the organization
large losses and the current structuredoes not permit adequate
of thesevarioussubsidiary
units;and
transparency
in the performance
-65Annex 6
Page
8
of 7
(b) Fleet rationalization
envisagedin the BIWTCStrategicPlan (Annex5)
will resultin very largeredundancies
in staffand BIWTCwill need to
findways to reduceits overallstrengthfrom around5,930at present
to around3,730in 1995,f.e.,a reductionof around2,200staff.
Basedon the above,and in supportof the Strategic
Plan (Annex5), a numberof
actionsare recommended
and theseare detailedin the followingparagraph.
BIVTC- Institutional
Dfvelownt ActionPlan
12.
GOB will undertakethe followingactionswith respectto BIWTC:
(a) Appoint a managementconsultantto reorganizethe corporation,in
accordance
with the BIWTC StrategicPlan, into five profitcentres-coastalpassengerservices,inlandpassengerservices, coastaland
inlandcargo services,ferry servicesand repairyards,BIWTCassets
and staff,includingcommercial
staff,will be distributed
amongthese
profitcenters;
(b) The BIWTCManagement
Consultants
(BMC)will develop,withinsix months
of appointment,
a BIWTCmanpowerrationalization
plan which theywill
then implement.The planwill includethe followingclementa:
-
Give optionof early retirementwith benefitsto all staff,who
have less than 5 yearsof serviceremaining(approximately
1,000
staff)--the
compeasationis to be funded from the proceedsof
vesselssold for scrap;
-
BIWTAwillbe allowedto recruit600 stafffromthe remaining
BIWTC
staff;
-
DOS will be allowedto recruit600 BIWTCstaff;and
(c) BIWTCwill takeoverthe Barisalworkshopsof BIWTAas part of its ship
repairprofitcenter.
All of the aboveactionsare to be completedpriorto the mid-termreviewof the
projectwhichwill be carriedout by June 1993.
C.
Department of ShiPPinp
13.
DOS cameintoexistencein the year1976as a department
of the Ministry
of Shipping.Itsmandatein relationto inlandwatertransport,
as distinctfrom
oceangoing/merchant
shipping,is summarized
as follows:
(a) Administration
of the InlandShippingOrdinance(ISO),1976and rules
thereunder,
includings
(i)
registration
and surveyof shipsand issueof certificate
of
registryand certificate
of survey;
(ii)
trainingof marineofficersand engineers;
-66Annex 6
Page 6 of 7
(iii) training,certification,
employment,
etc.,of vesselcrews;
(iv)
safetyof lUvesand shipsin inlandwatersand implementation
of rules,regulations
and international
conventions
relatingto
thesematters;
(v)
implementation
of rulesand regulations
relatingto dangerous
cargo;and
(vi)
investigating
accidents/casualties
througha systemof marine
courts.
(b) Regulation
of routesand cargoin respectof privatesectorships;and
(c) Implementation
of MaritimeZone'sAct and Rulesthereunder.
In addition,DOS is chargedwith a numberof minor functions,in someof which
its mandateoverlapsthatof BIWTA. DOS is a relatively
youngorganization
and
has yet to developthe institutional
capabilities
neededto fulfilits role.
DOS Instituti.sI.
Develojseut
ActionPlan
14.
DOS needs to significantly
expand its activitiesto bring about
improvements
in the regulatory
frameworkand relatedenforcement
mechanismsin
the IWT sector.
The following actionsare to be undertakens
(a)
Establish an Inland Ship Safety Administration as set out in paragraphs
20 to 24 below--this
entityshouldbe staffedwith personnelselected
from BrITC's existing staff;
(b)
Take over the Inland Deck Personnel Training Centre from BIWTA;and
(c)
Initiate
a study and other actions
set out in Annex 7.
on environmental
controls
for IV? as
All of the aboveactionsare to be completed
priorto the mid-termreviewof the
projectwhichwill be carriedout by June 1993.
15.
The Inland Shio Safety Administration
(ISSA)will be headed by a
Director,InlandShip SafetyAdministration.The Director,ISSA,will report
directlyto the DirectorGeneralof Shipping,
DOS. The ISSAwill be mandatedto
performthe followingfunctions:
(a) Enforce safety regulationswith respect to operationsof inland
vessels;
(b) approvethe designand construction
of inlandvessels,issue safety
construction
certificates,
and carryout periodicinspection
of vessels
and renew safety certificates
in accordancewith the provi.ionsof
applicableregulations;
and
(c) protectthieinlandwaterwaysfromenvironmental
degradation
causedby
the development
or operations
of inlandwater transport.
Annex 6
Page 7 of 7
16.
DOS will recruit about 600 surplus staff from BIVTC to fulfill its
under para 20 (a) above. These staff will be deployedat rural
responsibilities
launch stationsand inland ports. They will be responsiblefor reportingcases
of overloadingto the Director,ISSA for action by DG Shippingthroughthe Marine
Court. In support of this activity,DOS will establish a total of five marine
courts located at Dhaka, Chittagong,Barisal,Khulna and Narayanganj,and DOS
will appoint at least six specialofficersfor ,arine safety. Six 16-foot speed
boats will be procured for ISSA.
17.
All inland vessel design approval responsibilitywill be transferred
from BIWTA to ISSA togetherwith any personnelemployedin BIHTA solely for this
purpose. DOS will also be authorizedto employ 20 additionalvessel inspectors
and 8 surveyorsto perform the functions set out in paragraph 20 (b).
18.
ISSA will be the executing agency for the environmentalactions under
this project (see Annex 7).
Deck Personnel TrainungCentre
19.
Under the Credit, equipmentwill be procuredto upgrade the facilities
of the Inland Deck PersonnelTrainingCentre (DPTC),work will be undertakento
enhance the curriculum and teaching methods,
and steps will be taken to address
the issues in the inland water transport sector now affecting employment of
trained personnel of the centre. Details of equipment to be procured and
technical assistance to be provided for upgrading DPTC were discussed with
Governmentand are availablein the project file (Annex 19, Item 15). All of the
above would be carried out in agreementbetween GOB and the Association.
-68-
Annex 7
Page 1 of 2
RAMGLhDESH
THIRDINLANDWATER TRANSPORTPROJDCT
Environmuetal
Actions
1.
Environmental
actionsto be undertakenin the projectare designedto
improvethe capacityof the Government
to minimizethe environmental
impactsof
inlandwater transport(IWT)on Bangladesh's
waterways. They are comprisedof
threeactivitiest
(a) Environmentalmapping of the waterways to identify sensitive
resourceslactivities
that may be affected by IWT developmentor
operations;
(b) Establishment
of facilitiesfor the testingof dredgematerialsin
orderto ensuretheirsafedisposal;and
(c)
Assistancein the designof implementing
regulations
for the protection
of inlandwaterwaysfrom impactof ITW development
or operations.
This componentis to be executed by the Departmentof Shippingof the Ministry
of Shipping.
Environmental
MaPPig
2.
The
environmental mapping will
identify the
resourceslactivJities
alongand upon the waterwayss
following
(a) Major fisheriesand fish spawningareas;
(b) Industries
whichmay causepollutionof bottomsediments;
(c) Major sewerdischargesfromurbanareas;
(d) Major points of inland water transport
activities
such as ports,
pontoons, oil loadingor dischargeterminals,
industrial
terminalsand
storagefacilities
for fertilizer
or otherhazardouscargo;and
(e) Majorpopulationcenterslocatedalongthe waterways.
A Geographic
Information
Systemwill be used to storedata on all of the above
in a computerized
database.
DredgeMaterialsTesting
3.
A fullyequippedlaboratoryfor chemicaltestingof dredgematerials
i111 be established.Personnelwill be trainedin the use of the laboratory
equipment.Procedures
will be established
for testingof bottomsediments
prior
to commencement
of dredgingoperations. Laboratorystaffwill approvethe
proposeddisposal
methodfor dredgematerialsbasedon the resultsof the testing
carriedout.
-69Annex 7
Page 2 of 2
Regulations
for Environmental
Protection
of Inland Waterways
4.
Consultants
will review the provisions of the Environmental Pollution
ControlAct, the MarinePollutionOrdinanceand the InlandShippingOrdinance.
Basedon the provisionsof thesepiecesof legislation,
the consultants
will
in Bangladesh
for protectionof the
3viewthe regulatory
frameworkestablished
inland waters from impacts of waterway developmentand water transport
operations. Consultants
will recommendnecessaryregulations
and associated
implementation
mechanismsto coverany deficiencies
identified
in the existing
regulatory
framework.In particular,
the consultants
will examinethe need for
of establishing
controlsoverdischarges
frominlandvessels,and the feasibility
facilitiesfor the receptionof vesselwastes. The consultantsshouldalso
plans(andcapacity)
of the Government
examinethe adequacyof emergency
response
to respond to incidentsinvolvinghazardousmaterialstransportedon the
waterways.
-70AnnexS
Page 1 of 2
THIRD ILAD
WATERTRANSPORTPROJECT
Extension Facilities
for the Country Joat Sector
1.
Countryboatsin Bangladesh
performalmostas well and sometimes
better
thanthe "modernmechanized
inlandfleet,andconsidering
theirverysignificant
role in the ruralareasof Bangladesh,
the Government
wishesto encouragetheir
increased
participation
in inlandwater transport.Presently,thereare around
20,000largercountryboats(above5.5 tonscapacity)
engagedin cargotransport,
and around160,000smallerboatsused for passengerand cargo transport. At
least10 percentof this fleetis now mechanized
with the productivity
(ton-km
output)enhancements
from mechanization
rangingfrom a factor of 2 to 2.5.
Whereas,transport
costsavingsfrommechanization
arenot verysubstantial,
from
the viewpointof the waterwaysystem,mechanized
vesselsincreasesafetydue to
theirimprovedmaneuverability,
speedand reduction
in overallnumbers,and for
thisreason,it is the Government's
statedpolicyto encourage
mechanization
and
in this sector. The Government's
strategywill includea number
modernization
of measuresincludingprovidinginfrastructure
and facilitates
for technical
extensionservicesto encourageincorporation
of minimalsafetyfeaturessuchas
runninglightson mechanizedboats, and adoptionof appropriatefuel saving
technologies
such as sail-assist
mechanization.
Eztension
Services
the Government
has no capacityfor extendingassistance
to
2.
Presently,
the countryboat sector. Under the project,it is envisagedthat BIWTAwill
establishfacilities
at variouslocations
in orderto servicethe needsof rural
countryboat operators.Areas in whichBIWTAwouldprovideextensionservices
includes
(a)
technical
assistance
in the selection
of appropriate
mechanization
technology and incorporation of safety features, and in the maintenance
of boat enginesand propulsionsystems;
(b)
technical assistance in the securingof creditto financenow boatsor
for mechanization of existing craft; and
(c) technical assistance for
the establishmentof
boat owners'
associations.
The Boat Owners'Associations
established
by BIWTA,would advise Government
agenciessuch as BIWTA and DOS on issuesthat affectthe development
of the
countryboat sector.
Iacilities
to be Developed
3.
Undertheproject,BIUTAwouldbuildand staff10 CountryBoatExtension
Facilitiesat appropriatelocationsin areaswhere there are a significant
concentration-of
countryboats. The facilities
wouldbe equippedas follow:s
-71Pape 2 of I
(a) one buildingmeasuringapproximately
100 sq m;
(b) threedemonstration
boats fittedwith enginesand propulsionsystems;
(c) 100 sets of propulsionsystemsavailablefor lease
countryboat association;
and
(d) miscellaneous equipment as
activities.
to members of the
needed for demonstration/training
Each facilitywill be fundedfrom the proceedsof the creditwith US$150,000
equivalent
to be used for any of items(a) through(d) above. The creditfunds
will not be used for acquiringland.
Iaaaamant of the Facility
4.
BIWTAwill designate
one officerfromits staffto manageeachfacility.
Additionalstaffmay be recruitedby the CountryBoatAssociation
from its own
resources which would include members dues and surpluses generated from the lease
of equipment.Leasingrateswill be basedon interestratesof coaercialbanks,
and will be set at levels adequate to cover the cost of operatingthe extension
facilityand of replacingthe leasedequipment.
-72-
Annex 9
Fe-g. 1 of 1L
PROJECT
TSIlD IlRLA1DWATERTRANSPORT-
Cost Eetilates
Detailed
UDTake Ml II on
I.00
1.10
1.0
1.4
1.44
1.48
1.44
1.60
1.61
1.70
1.71
1.72
1.78
1.74
1.80
2.00
2.40
2.41
2.42
2.60
2.61
SIWTA:
Dr.dglng,b/
102.
6.8
6.6
aI.
8.4
6.0
8.4
=2627
2156.1
20.5
27.4
65as0 71.9
10.8
10.8
68.4
71.9
102.7 109.8
81.8
47.9
166.6
~~~~47.
as.4
1is.
9asmCost UZVA
Contingnc
Pe CoContIngenc
Subtotal SVA
Teax. enWCustom,Duties
TotaI SWV1A
SIVtC
Ugulpeent
Fleet "etol tltaion
0.?
14.
4.4
60.1
30.6
149.7
180.9O 1024.
164.8
0.0
bred"
opratIons I,ro,eaent
pPh0algal
& 4Aup t.
M,1so.FeeIlItl*s
CapaIty Oil lding -TA
1vwCNuagement, Coneultent
2.71
2.72
2.78
2.74
Sue. Cast DIMV
Poiwesl Contingency
Pr co ContIngency
Suobtotal SIWY
Taxessend Customs Outlee
2.80
Touts OD"
8.00
M0:
2.70
0.0
getlon
AIde-Toaoton
In'n
1.41 a Inebe
of .edgera
A
1.42
Suport
brd" ft.
eeo
lt.sNntrn
SurveyVorl.boata & Ace.... Bar#"
ystom
8lectronial Posititon Fltealn
Ext. P.c. for Counttr
lot Assoc.
Cupaclty SuildIn-gTA
1.20
8.:40 Iqupepoenratrout:aM.
6N)00
841 16 FotPto
at
8.2Dod Personnel Training Centre
etLbrtr
8.4
USN llllon o/
0.0
87.
18.1
17.1
10.8
102.
10.8
944.
94.4
174.5
12184
1064.
024. 8
189.2
171.
16.
61.8,
.sg
os
Ioa oanTta
L.o.Coronent/Sub-Congnet
0.0
I.
1.
2.0
0.2
0.2
0.0
a.1
0.2
0.1
54
5.5
0.6
1.9
0.0
Tota
Percentage
of
8.
6.6
7.5
0.8
2.1
0.8 08
2.0 21
.0
8.2
1.5
1.4
0.81
4.2
0.4
0.9
8.6
5.4
284
2.8
4.2
-29.9
0.0
2010.
29,9
78.7'
0.5
4
5.0
1.8
Sea coat
7.0
0.8
0.7
46.8
6.4
11.9
62.7
12.6
40.
98.2
12.6
5.4
8.4
84.2
87.6
0.1
1.0
1.1
2.6
84.9
8.4
6.6
44.
80.4
2669
26.7
58.4
870
0.0
801.1
80.1
60.2
8~91.8
66.4
1.0
0.1
0.2
1. a
2.0
7.6
0.6
-1.5
6.6
0.9
1.6
20.8
2.1
4.1
01
1.t2.
0.0
2.0
870
49.
.
01
84
0.0
0.2
0.2
.9
84
0rdelts
.4
66
66
40
10.8
274
18.7
62.1
0.1
0.1
0.7
0.8
0.4
2.0
.8
0.
0.1
1.2
purt 0, Item
Putt P., Ite"
(c)
.9
2.1
1.8
8.0
Part I, It=
Put U, Ite
putt F, ite"
(lf)
87.
164.8
26.
1.1
8.4
0.8
1.1
0.7
1.8
.6.
11.2
8.78
8.74
Subtotal D0o
Taxes and Custoos DutIes
8.
47.9
20.
26.2
47.9
1.4
1.4
7.0
0.0
85
1.4
19.7
8.8
96.6
2402
8791
2.67
7.0
9.
28.0
,41480.0
8.8
56.6
42.9
100.0
0,0
55.4
6.8
129.0
20.5
47.1
64.
149.5
5.80
Total
4.00
OVUtALLPR0.Wr;
4.70
Total Contingencies
D05
8.6
7.8
16.8
87.0
0.0
Tofta Soe Coat
21.$
4.80
4.81
TotalI Project Coat
Total TaxesA CustomsDuties
2.81611.8
801.
0.0
4.90
ProjectCost IncI.TAM
Toftal
868.8
4.60
a/ kW 1.0 - Tk. 84.22
b/ By Fopce Account, fuel coab only.
/At JuO190
"Ie
S21ource:
00Mn
unI.Staff
80.7
125.
809.8
22.2
44.5
425.0
189.
80.1
1611.8 21952
0.1
0.2
2.0
684.1
'.
17.1
0.4
10.5
(b)
8.6
Be". Coast.06
Phalcoal Contingero)y
PrIco Contingency
0.1
Part U, ite"
2.4
8.70
8.71
8.72
44.8
0.8
12.8
-FIIDMA
t.C)
0.9
18.7
17.1
Ite"LI:.
Purtto:
part 0, it"e()
1.
8.4
8.
Part 0
0.
0.6
0.4
68.4
05
Item (a)
-
Ii4OWA
4.7
18.?
41.1
Part a,
8.
8.81
DsIgn 8Coord.Consultant
CaelyBIdn
TA:
8.6
da.1.
861 InadUpSft
A NappIng
8.62
Er4ontlRgltIon
£ Mauc
OecosafTrIning
8.68
8.4
port A
s 9 parta
17.5 Part C
1.9Pat 0. Itm
4.9 PFe0,Ie
0.7 Part 0, It..
4.
Part 0, Ite.md
7.8' Part 0. Item
8.8 Putt 0. its"1
27.
2.8
8.1
85.5
8.4
.4
2.8
Rowkret
1.2
1.5
8.0
29.0
Per-tO, Ite.ml)
j)
4
.
P
-PIMIDA
P112
JOP
-73Annex 10
Page 1 of 1
TMD IMAND WATERTRaXS
T RJECT
Estimated Schedule of Credit Disbursemnt
(U8$ dillion)
IDA FiscalYear
and Half-Year
Half-Year
Cumulative
1992,Half-Yearending
December31, 1991
June 30, 1992
0
1.3
0
1.3
1993,Half-Yearending
December31, 1992
June 30, 1993
2.6
3.1
3.9
7.0
1994,Half-Yearending
December31, 1993
June 30, 1994
2.5
9.5
2.2
11.7
1995,Half-Yearending
December31, 1994
June 30, 1995
3.6
3.6
15.3
18.9
1996,Half-Yearending
December31, 1995
June 30, 1996
5.4
3.6
24.3
27.9
1997,Half-Yearending
December31, 1996
June 30, 1997
3.6
2.7
31.5
34.2
1998,Half-Yearending
December31, 1997
June 30, 1998
4.5
3.6
38.7
42.3
1999,Half-Yearending
December31, 1998
2.7
45.0
-
-76Ane
Ir
,
I
.4
_
I
I. I
I
==t
rT m:----
.I
4,
_*
-|
I
II11
__
__I_I_.
__
_.__
_
_.4
Ii
11
-75AnnXe12
Pogp 1 of 12
DANSLADESH
PROJWCT
THIRDINLANDWATRTRANSPORT
Tern of Reference for Project
A.
Des
Consultant
nd Coordination
Introduction
the criticalimportanceof the inland
The 1988 flood demonstrated
1.
regulartransportnetwork
water transport(IW) systemas part of Bangladesh's
The ITW systemhas,however,been accordeda
and its emergencyinfrastructure.
much lower prioritythan other transportmodes in spiteof the fact that it
carries over a third of total freightmovementsand around 20 percent of
its strategyin lightof
is now rethinking
passengermovements.The Government
experienceduringthe flood.whenIWT provedto be the only reliablemeans of
a valuable
the IWT represents
emergencyassistance.Moregenerally,
delivering
of whichhas beenlessthanoptimaldue to: (a)
transportasset,the utilization
(b)inefficiencies
channels;
of navigation
andmaintenance
development
inadequate
in the trainingand
in the operationsof inlandfleets;and (c) inadequacies
of IV?. Probably,
for development
responsible
planningcapacityof institutions
one of the most criticalareas of IWT requiringattentionis safetyon the
waterways. Over the last 10 years,therehas been numerouspassengervessel
accidentsresultingin lossof livesnumberingin the thousands.A MasterPlan
for the IWT sectorhas been finalizedwith Dutch technicalassistance. In
(IDA)has beenexecutinga
Association
Development
addition,the International
pment Programin 1989on
and
Devel
numberof studiesfundedunderthe U.S.Trade
surveys,trainingand
hydrographic
aids,
navigation
vessel safety,dredging,
development.
institutional
D. The Project
ProjectObjectives
for the IWT sector,the projectwould
By financingcore investments
2.
seek to ensurethat the Governmentcan addressthe essentialelementsof its
strategyares (a)
strategy. The objectivesof this development
development
controls;(b) increasinginland
improvingwaterway safetyand environmental
passengertransportcapacity;(c) improvingcapitalasset utilization;(d)
reducinginland water freight transportcosts; (e) improvingcountry boat
operations;(f) improvingthe financesof BIWTAand BIWTC;and (g) improving
and trainingof inland
capacityfor planning,policyformulation
institutional
vesseloperators.
ProjectDescription
The variouscomponentsof the projecthave been groupedinto five
3.
parts,as follows:
-76Amex 12
Pga 2 of 12
PartA: Dredging(BIWTA- US$3.0million)
4.
Selectedwaterwayswould be deepenedas needed to ensurethat 1.8
meters of water are availableat all seasons. Dredgingworks totalling10
millionue wouldbe carriedout by forceaccountat a rateof 2 milliontelyear
usingBIWTA'sdredgesas followst (a) 2 millionmn at the Ajmiriganjsectionof
the Meghna-Kushiyara
River; (b) 1.3 millionm at the Baulai sectionof the
KangsaRirer; (c) 1.7 millionms in the TitasRiver;and (d) 5 millionm8 fcrehabilitation
of certainpatchesof ClassI and ClassII waterways,.
including,
accessto BaghabariPort. The projectwouldfinancepartof the costof dredging
operationsbased on fuel and repair expenses. IDA has consideredthe
international
aspectsof thiscomponent,in particular,
dredgingon the Meghna
River. Althoughthisis an international
waterway,theworksproposedunderthis
projectwouldnot adversely
affectthe quantityand qualityof waterflowsto any
ripariancountries.Similarly,
the workswouldnot be adverselyaffectedby the
use of water that ripariancountriesmightmake.
Part B: Aids to Navigation(BIWTA- US$6.8million)
5.
Aidsto navigation
on about1,200km of ClassI and ClassII waterways
will be upgradedto secureday and nightnavigation
by rehabilitating
existing
equipmentand providing
new floatingand shorelights,buoys,beacons,etc.,as
well as replacement
of about75 percentof acetylenepowered pghts
with solar
powered lights. Thiswouldmainlyinvolveprocurement
and iustail.tion
of about
400 shore lights,
S0 lighted buoys and 100 unlighted buoys. Waterways to be
upgradedare: (a) all Class I and Class II waterways; (b) proposedClass II
waterwayfrom Bhairabazar
to Chattak;(c) waterwayapproachesto Mongla and
Chittagong
seaports;
and (d)Aricha-Daulatwia-Nagarbari,
Bhuapur-Sirajganj,
and
Mawa ferryroutes.
Part C: InlandPontoonFacilities(BIWTA- US$7.5million)
6.
Presently,thereare about1,400 landingstationsat which launches
handle passengersand cargo. Of these, only about 230 have pontoons to
facilitate
passengerand cargomovements.An additional
l00pontoons,including
five sparepontoonsto replacethosebeingmaintainedor repaired,and their
access bridges would be providedunder the project at selectedlocations
conforming
to the pontoonlocationcriteriaagreedwith Government.
Part D: Equipment(US$19.1million)
7.
The projectincludesnumeroussmallercomponentsas followss (a)
procurement
of equipment'or rehabilitation
of 5 BIWTA18-inchcuttersuction
dredgersincludingfuelmonitoringsystems;(b) procurement
of sparepartsand
floatingsupportequipmentfor BIWTA'sdredgers;(c) purchaseand installation
of equipmentto upgradeBIWTAand BIWTC'sHighFrequency(HF)telecommunication
systemand establishment
of distressfrequency
monitoringat Dhaka,Monglaand
Chittagong;
(d)purchaseof inlandsurveyworkboatsand accormodation
bargesfor
"ClassI Waterway"meansa waterwaywith a minimumnavigabledepthof
12 feet; and "ClassII Waterway"means a waterwaywith a minimum
navigabledepthof 6 feet.
-77-
Annz 12
Page 3 of 12
BIWTA surveycrews; (e) procurement
and installation
of an electronic
position
fixingsystemto replaceBIWTA'sexistingDecca system;(f) rehabilitation
of
for the BIVWC
selectedBIWTCvesselswithinthe overallparametersestablished
fleet in the StrategicPlan; (g) procurement
of miscellaneous
equipmentand
facilities
for BIWTCincludingfuelmoni*oringsystems;(h) purchaseof 6 speed
boatsto DOS for safetypatrols;(i)pur%.hase
of equipmentfor strengthening
the
DOS InlandDeckPersonnelTrainingCenter;(j)purchaseof equipmentfor DOS for
environmental
control;and (k)purchaseof equipment
and facilities
for country
by BIWTA.
boat ownersassociations
to be established
Part E: TechnicalAssistance(US$6.5million)
components
wouldalso be financed
8.
The followingtechnicalassistance
of BIWTAOperationsImprovement
Action
under the project: (a) implementation
to implementthe agreedBIWTCStrategicPlan;
Plan; (b) managementconsultancy
(c) projectdesignand coordination
supportfor the ProjectMonitoringUnit of
within DOS; (e)
of InlandShip SafetyAdministration
MOS; (d) establishment
preparation
forDOS of an environmental
mappingof thewaterwaysand development
of implementing
regulations
for environmental
protection
of inlandwaterways;
and
(f) assistanceto DOS to developthe InlandDeck PersonnelTrainingCenter.
Totalwork monthsof technicalassistance
requiredis estimatedat about410.
TenderDocuments,Call for Bidsand ContractsAward
9.
TenderDocumentshave been preparedfor many of the componentsby
starting
will be prequalified
consultants. It is expectedthat contractors
November1991, call for bids is scheduledfor March 1992, contractaward for
for civilworks
August 1992 and projectcompletionfor June 1996. Contract-s
construction
and equipmentsupplywill be awardedon the basisof international
competitive
biddingin accordance
with the World Bank and IDA Guidelinesfor
Procurement.
C.
Scope of Project
Design and Coordination
Services
Main Objective
10.
The primaryobjective
of the servicesto be providedby the Designand
Coordination
Consultants
(DCC),underthe contractshallbe to ensurethats
(a) implementation
of the variousprojectcomponents
is carriedout in a timely
and coordinatedmanaer, and is in accordancewith the terms of reference,
drawingsand technicalspecifications
agreedwith the various consultants,
contractorsand equipmentsuppliers;and (b) this is accomplishedin an
economicaland efficientmanner consistentwith internationally
accepted
engineering
standardsand practicesand to the specifiedrequirements
of the
Ministryof Shipping(MOS),Bangladesh
InlandWaterTransport
Authority(BIWTA),
and Bangladesh
InlandWaterTransport
Corporation
(BIWTC).In addition,
the DCC
will be responsible
for monitoringthe implementation
of variousactionplans
agreedwith the Government
underthisproject.
11.
The contractto which thtise
termsof referencerefer,shallgenerally
Services"
be in accordancewith the "SampleForm of Contractfor Consultants'
publishedby the World Bank in March 1989 (copyattached).
-78Annex 12
Pat .4 of 12
Scope of Services
The Scopeof Servicesprovidedby the DCC shallincludes
12.
of Bid Packagesand TenderDocuments.
(a) Preparation
To designthe bid packagesand preparethe finaltenderdocuments.
(b) Bid Evaluation.
in the call for and reviewof bids,their evaluation
To participate
for contractsaward.
and reconmendations
(c)
and Reporting.
Projiect Coordination
by
of the variousprojectcomponents
the implementation
To coordinate
way of:
(i) projectmanagementand control,includingupdatingof project
betweencontracts;
planning,and relatedcoordination
of progresspaymentss
(ii) budgetcontrol,approvaland certification
for funding
(iii) financialcontrol,includingcash flow projections
organizations;
of any changedor changeable
and documentation
(iv) timelyindication
conditionswhich may have an adverse impact on the project
measuresto
on relevant
scheduleand/orbudgetand recommendation
be taken to mitigate such impact and to safeguard the
of the project;
implementation
Cv) preparationof periodic progress and other reports, and
meetings;
of projectcoordination/liaison
organization
team;and
(vi) managementof the projectcoordination
Officeat Dhaka.
a ProjectCoordination
(vii) maintaining
of CivilWorks,Dredgingand EquipmentSupply.
(d) Supervision
The supervisionshall in general be carriedout by the Resident
Engineersassistedby a numberof Site Engineers.Their task shall
include:
of surveys,settingout and siteinvestigations;
(i) the supervision
of
of inspection/testing
or supervision
(ii) the inspection/testing
material and manufacturedcomponentsof the temporaryand
permanent
works;
(iii) the checkingof sourcesof materialsand equipmentproposedfor
purchaseor for use in the temporaryor permanentworks:
-79-
Annex12
Pag 5 of 12
(iv) the checkingof day-to-dayshopdravingst
schemes:
(v) the checkingof dredging/constructionlerection
of the works;and
(vi) the siteinspections
(vii) the interimmeasurement
of the works.
(e) Operationand Maintenance
(O/M).
To manage and coordinatethe taking over and successfulstart of
partsof the project
(ON) of the different
operationand maintenance
by way oft
and
of trainingof local staffby the contractors
(i) supervision
othersin designand execution;
and
of trainingof local staffby the contractors
(ii) supervision
partsof the project,
in O/M of the completed
equipmentsuppliers
by the contractors
(iii) checkingand approvalof OM manualssubmitted
and equipmentsuppliers;
of an overall0/Mprografe; and
and definition
(iv) establishment
(v) handingover 'As Builtdrawings'as may be required.
The variousservicesoutlinedaboveare furtherdetailedin SectionsIV to VII
of theseTOR.
D.
Project
Coordination
and Reporting
simultaneous
13.
To ensure the satisfactory
components of the project,
the DCC shall carry
coordination and reporting activities:
Project
execution of the different
out the followingproject
Planning
at the onset of the projectof a detailedbarchart
The preparation
14.
path network CPN or
program (partlyor completelyin the form of a critical
andcriticallinksbetweenactivities
similarchart)showingallmajoractivities
monitoringprogressin
of the wholeproject. Thereafter
for the implementation
relationto the projectscheduleand updatingthe overallprogramfor the project
as and when
of each of the components,
and barchartsfor the implementation
necessarv.
ProgressControl
will be
The periodicupdatingof barchartsfor eachof the components
15.
made to monitoractualwith plannedprogress. This will be includedin the
monthlyprogressreports(para23) to be submittedto the MOS. These reports
to avoidany
or delays,measuresnecessary
on stoppages
will includeexplanations
losttime
to
recover
any
of
measures
required
delays,
and
an
indication
future
-80-
Anmez12
Pape 6 of 12
in the implementation
of the project. Hattersrequiring
actionshallIteclearly
in the progressreports.
highlighted
Coordination
The coordination
betweenthe variouscomponentson site in relation
16.
of all physicalinterfacesboth for
planningand Interaction
to construction
permanentand temporaryworks.
Contractual
Documentation
of all certificates,
17.
The checkingof the adequacyand authenticity
ownership
of plant,etc.,for which
performance
bonds,indemnities,
insurances,
the contractorsand equipmentsuppliersare liable under the Conditionsof
Contractfor each of the contracts.
Certificates
Certificates
of
The preparationof InterimPayment Certificates,
18.
and MaintenanceCertificatesin
Completion. Final Payment Certificates,
accordancewith the Conditionsof Contractfor payment by the H08 in the
differentcurrenciesinvolvedin the contracts.
Control
BudgetarylFinancial
controlby meansoft
Projectbudgetary/financial
19.
(a) keepingup-to-daterecordsof commitments
and disbursements;
(b) periodiccheck on quantitiesof work ezecutedand thosestillto be
executed(ina threemonthlyreviewof projectexpenditure,
bothlocal
and foreign);and
(c) projections
of cash-flow
and requirements
for financial
contributions
by the variousfinancingorganizations.
of New Ratesand ClaimsAssesment
Establishment
20.
Formulationof recommendations
to the OS on the rates for any
and
unscheduleditems of work which may arise. Recording,investigating
assistingin settlement
of claims.
Optimization
of the Construction
and DredgingProcess
21.
AdvisingMOS on possibleways to reducethe expenditure,
and advising
BIWTA and the contractors
on possiblemeasuresfor improvingefficiencyand
reduc'ngthe totalprojectcosts.
Records
22.
Maintaining
daily recordsof work progress,labor, equipment,major
construction
materialsat site,workaccomplished,
weather,waterwayconditions,
accidentsas well as any othereventsaffectingprojectcostor implementation
schedule.
-81Annex 12
Pose 7 of 1Z
Reporting
Preparation and submission of monthly progress reports, quarterly
23.
status reports and constructioncompletionreports to the MOS and the various
financingorganizationsinvolved;each report in 20 copies as follows:
(a) The monthly progressreports shall present a summaryof the status of
the various project components (schedule, budget, actual and/or
potential problems and delays). They shall be illustratedby means
of photographs, graphs and tables which enable the MOS and other
interestedparties to obtain an up-to-datepicture of the stage of
completionof the project as well as of progress achieved during the
report period. They should be submittedwithin 30 days of the end of
the reportedmonth and should include informationons
li) principal work accomplished or equipment supplied during the
period covered by the report;
(ii) comparison of actual progress with the original estimated
scheduleof constructionand procurement,and with the schedule
agreed upon with the contractorsand equipment suppliers;
(iii) actual or contemplatedmajor deviationsand reasons thereof from
originalplans or schedules,other than changes of a character
which would require prior consultation with the MO$ (such
contemplatedchanges should be reported to the M08 immediately
and also be includedin the subsequentprogress report);
(iv) the development of cost estimates and expenditures and the
availabilityof funds to meet the cost of the project;
(v) conditions which would significantlyaffect the schedule of
dredging, construction,or equipment supply or the cost of the
project; and
(vi) progressmade on training.
(b) The quarterly status reportsare requiredby the MOS to report to the
Governmentof Bangladesh (GOB) and to financingorganizations. The
kind of information required for this Report will be narrative
descriptionsof project status,problemsencounteredand anticipated,
and actions necessary to correct emerging problems indicating
agency/officewhich should undertake such actions.
(c) The ContractCompletionReport shall be submittedwithin three months
of the substantialcompletionof equipment delivery, dredging of a
certain portion of the waterway or completionof each construction
contract or section therefore giving details, inter alia, of works
carried out; major problemsencounteredand measuresto resolvethem,
any changes in -design with reasons therefore, delays if any and
reasonsthereof,a comparisonof costs as actuallyincurredwith those
anticipated initially, performance of the different implementing
agencies, contractors, and equipment suppliers review of. any
outstandingclaims and other aspects particularto each contract.
-82Anex 12
Pogo 8 of 12
Project
H4etings
24.
Participationin semi-annualproject meetings with the various
implementing
agenciesand contractors
and assistanceto MOS in the conductof
such meetings. The DCC shall coordinatethe participation
of the various
agenciesat thesemeetings. The meetingswill be held to discuss,interalia,
progress,coordination,
problemsencountered,
and paymentsrelatingto the
project.
S. Supervision
Inoection
The supervision,
in particularthat for dredging,construction
and equipment
deliveryand installation
contractsshallincludethe followingtaskss
Surveys,SettingOut
25.
Checkingof surveys,soundings,settingout of works (included
datum
pointsand assumedbenchmarks)and measurements
neeessaryfor the satisfactory
construction
of the worksand for interimand finalpaymentcertificates.
Site Investiation
26.
Supervising
any siteinvestigations
undertaken
by contractors
either
as requiredunder the contractsor as otherwisenecessitated
for the proper
excution of the works.
Inspection
and Testing
27.
Carryingout as may be necessarythe inspectionand testing or
supervisionof such inspectingand testing,in Bangladeshor elsewhereof
materials,
manufactured
products,electrical
and communication
v juipment,
plant
and machinery intended for the project in compliance with the °/4cification
and
other requirements,
laid down in the various construction
contracts. Where
appropriate
thiswill also includethe testingof operatorsin accordance
with
the contract(forexamplethe testingof welders).
Suitability
of Sources
28.
Ascertaining the suitability
or otherwise of manufacturers and sources
of machineryand equipment,and materialsthat contractors
proposeto use to
constructthe work either for temporaryworks or for iniorporation
in the
permanentworks.
Working Drawings
29.
Checking of such working drawings produced by the contractors
and as
are necessary for the proper execution of the temporary and permanent-works.
ConstructLon/rection
Seheme*and TmPorary Works
30.
Checkingof construction/erection
schemes,and of temporaryworks
proposedby the contractors
to be implemented
by them in the exseutionof their
contracts.
-83Annex 12
Pop 9 of 12
Site
Inp@tio
31.
Site inspection
of the work (including
work to be coveredup) to check
the satisfactory
performance
of the contractors
and executionof the projectin
accordance
withthe different
contract
documents
and soundengineering
practices.
Measurement
'
32.
Periodiccheckingand recording
of quantitiesof works completed,to
assessappropriate
interimpayments,and to assessprogressachieved.
Issue of Iostructions
33.
Issuingall necessaryinstructions
to the contractors
and equipment
suppliers. in writingwhere required,as providedunder the Conditionsof
Contract.
Acceptance
and ReJectionof Work
34.
Acceptanceor rejectionof the work or any part thereofconstructed
by the contractors
or equipmentsuppliedby equipmentsuppliersin accordance
with the Specification
and Conditionsof Contract.
Instructions
for Testing
35.
Instructing
contractors
and equipmentsuppliersto carryout suchonsite tests, as may be considerednecessary,including supervisionand
verification
of sdchtests.
A_poyiztment
of Consultants'
Site Staff
36.
Appointment
of such site staff as the M1S considerscompetentand
necessaryfor the properand timelysupervision
of -he works.
Other Duties
37.
Carryingout theirotherdutiesas definedby theircnatract,as may
be necessaryand incidental
for satisfactory
supervision
and bmplementation
of
the project.
F. Modifications
to the Design
38.
The DCC shall recommendto the MOS any changes in Drawings and
Specifications
which may prove necessaryor desirableduring the course of
projectimplementation.
Suchchangesof Drawingsand Specification
may become
necessarydue to any of the followingreasons:
(a) A change,prior or duringconstruction,
in the,naturaltopographic,
bathymetric,
hydrological
or geotechnical
conditionsnear or at the
siteof the works,and on whichctnditionsthe design has been based.
Such changein conditions
can for instancebe due tot
-84Annez 12
Page 10 of 12
(i) erosionof waterwaybanks resultingin changedbanklinesand
anothersite configurationt
(ii) major shiftingof waterwaychannels;and/or
(iii) increasedflow throughsecondaryrivers creeks and floodways
whichare to be "bridged"
by structures;
(b) The discoveryduringconstruction
of subsoilconditions
not knownat
the time of design;
(c)
Delays in the start of construction,
dredging,in the deliveryof
period of certainitemswhich,
equipmentor in the implementation
withoutany actionbeing taken,may lead to seriousdelays in the
of otheritemsof the project;
implementation
receivedfrom the MOS; and/or
(d) Instructions
(e) Non availability
(time,qualityor quantity
wise)of ceL.ainmaterials
whichmay necessitate
thatDrawingsand/orSpecifications
be amended.
G. IUplementation
of Operation
and Maintenance of Cmpleted
Project
The servicesto be providedby the SC will includethe followings
Manuals and As-Built Drawings
39.
Delivering to the MOSon completion of the projectsuch recordsand
manufacturers'
manualsincluding
approveddAsBuiltDrawings"as may be necessary
operateand maintain(O/M)the completedproject.
to satisfactorily
Check on OI Rec_mmedationsby Others
40.
Scrutinizing
the recommendations and suggestions
for operationand
maintenance prepared by the contractors
and equipmentsuppliers
as partof their
contracts
and equipmentcontracts.
underthe respective
construction
obligations
Establishment
of O/M Progrsam
Manualsprovidedby
41.
Integrating
the variousOperationand Maintenance
manufacturers
and contractors
to one efficientO/M progrommeincluding:
(a) timely and efficienttrainingof M0$, BIWTA and BIWTC staff by
contractors,
equipmentsuppliers,
thirdpartiesor by the SC;
(b) description
of MOS, BIWTA and BIWTCstaffdutieswith regardto the
pro4ect;
(c) specification
of equipmentfor use by MOS, BIWTA and BIVTC for
Operationand Maintenance;
and
(d) programmefor monitoring,
regularinspections,
datacollection,
data
storage and analysis.
-85Annex12
Page 11 of 12
Construction
Coipletioun
Repwrts
42.
Preparingand submitting
contractcompletionreportsas outlinedin
para 23 (c).
Coordination
on Startof Operationof Project
43.
Coordinating
betweenMOS and contractors
and equipmentsuppliersin
orderto arriveat an orderlyhandingover of (partsof) the worksresultingin
a timely and smooth start of operations.
Settlement
of Contracts
44.
AssistingKOS in finalsettlement
of all contracts.
B. Facilities
and Attendanceto be Providedby the MOS
Facilities
45.
MOS will make availablefor the use of the DCC and theirpersonnel
certain facilities(includingoffices, furniture,cleaning,operationand
maintenance)
wihich
will be providedby the contractors
under the projectin
accordancewith their contract. MOS will not providehousing for the DCC
personnelor theirfamilies.Theseshouldbe arrangedand paid for by the DCC.
Attendance and Services
46.
In addition to the facilities
to be provided by the MOS through the
various construction
contracts,
the MOS will also mpke available to the DCC
through these construction
contractsthe followingc endanceand services:
(a) qualifiedlaboratorytechnicians,
drivers,chainmen,boatmen,and
watchmen;
(b) telecommunications
betweenthe sitesand Dhaka;
(c) telecomnunications
at sites(including
P.M.radiotransceiver
units);
and
(d) electricity
supplyand water supply,sewerageand drainagefor all
officesand laboratories
providedby the MOS.
Exemptionof Taxes,Duties,Etc.
47.
The Government
of Bangladesh(GOB)undertakes
to exemptthe DCC from
or bearthe costsof any taxes,duties,fees,leviesor otherimpositions
imposed
under its laws and regulations,
nationallyor locally,on the DCC and their
personnelwho are not citizensof Bangladesh,
for paymentssuch personnelmay
have to make in connection
with the executionof theirservicesincluding:
(a) incomeearnedin Bangladeshfor work on the project;
-86Annez 12
Page 12 of 12
(b) equipment,
materials,booksand suppliesbroughtinto Bangladesh
for
the purposesof executionof work on the projectand which, at the
termination
of the serviceson the projectshallbe takenout of the
country;and
(c)
personal property brought into Bangladeshand which will be
repatriated
upon the departureof suchpersonnel.
Customs, VisA
48.
The GOB also undertakes
tot
(a)
facilitate
prompt clearance through customs of personal property and
equipment, materials and supplies required by DCC's personnel; and
(b)
provide the DCC's expatriate
personnel and their dependents with
multi-entryand exit visas and the required resident permlts and
traveldocumentsas neededfor theirstay in Bangladesh.
AvailabilitY
of Data
49.
In connection
with the DCC'swork which requiresthe cooperation
of
Government
agencies,the Government,
throughthe MOS,will provideliaisonand
will ensurethat the DCC has accessto appropriate
information
requiredduring
the project.
-87Anne_ 13
Page 1 of 4
BANGLADSH§
THIRDILUANDWATXR
TRNSPORT
Torms of Referencefor BIrTC Management Consultant
A.
Backround
1.
The objectivesof the IWT-IIIProject(theProject)includes,among
others,the objectiveof achieving'financial
viabilityof the publicsector
BangladeshInland Water TransportCorporation(BIWTC). To this end, the
Government
and IDA have agreedon a strategicplan for BIWTCto be implemented
overthe FourthFiveYearPlanperiod(4FYP,FY90191
to 7Y94/95). A copyof this
strategicplan is attachedas Annex 5.
B. Objectives
of the Assignment
2.
':he ManagementConsultant (MC) shalls
(a) assist BIWTC in
implementing
the StrategicPlan,and (b) preparea detailedplan for the future
development
and restructuring
whichcouldincludedivestiture
or privatization
of each of the fiveprofitcentersestablished.
C. Scopeof Services
S.
The ManagementConsultantshallundertakethe fol-Lwing:
(a) Implementation
of the Organizational
Restructuring
of BIVTW
Funct'onsof each of the five profit centers will be defined;
managementteamswill be established
for each profitcenter;staff
neededfor each profitcenterwill be selectedand assigned;assets
requiredfor each profitcenterwill be identified,
inventoried
and
assigned;financial
statements
for eachprofitcenterwill be created
together
with finaucial
arrangements
relatif;the liabilities
of each
profitcenterto the parentcorporation
which is BITTC
(b) Implementation
of the Financial
Restructuring
of BIWSC
Existinglong-termliabilities
of BIWTC to the Ministryof Finance
will be rescheduled;
outstanding
interestpayablewill be converted
to equity;an Action Plan to improvethe positionwith regardto
AccountsReceivablewill be preparedand implemented
and a clearly
definedpolicyon futurecreditto shippers
will be established;
and
assetsof BIWTCwill be revalued.
(c) Managingthe ManpowerRationalization
Program
In establishing
the profitcentersand assigningstaffto each, the
numberof staff assignedto each profitcentershouldbe kept to a
minimum,the remainingstaffare to be tdentifitd
In a surplus
staff
pool assignedto the parentcorporation.PresentBDIMCHeadquarters
staff will be reassignedto each of the profit centers,and the
-88-
Annex 13
Page 2 of 4
of the parentBIWTCwill be assignedno more than100 of
Headquarters
of the activities
willincludecoordination
thesestaffwhosefunetion
will assistin developing
of the fiveprofitcenters. The consultants
and managingan early retirementschemewherebythe proceedsof the
vessel disposalprogramare utilizedfor early retirementof staff
with less than fiveyears of remainingservice,and will assistin
negotiatinga reasonableseverancepackagefor those takingearly
will help coordinatethe
retirement. In addition,the consultants
to BIUTA and 600 staff to the
transferof approximately
600 staff,
Departmentof Shipping.
(d) Organizing and Assisting in
Rationalization
Program
Implementationof
the
Fleet
In accordance
with the strategicplan, the conaultants
will assist
BIWTC managementin progressively
disposingof vesselsto reach a
fleetsizeof under150 vesselsby June1995. Thesevesseldisposals
will be accomplished
via a combination
of sales to privatevessel
operatotsor scrapping.Salesto privateoperatorscouldincludea
who
financingplanwherebyBITWCagreesto financeprivateoperators
wouldacquirethevesselsuponpaymentof a minimumdownpaymentwhich
is abovethe scrapvalueof the asset.
(e) Preparingand Assistingin Implementation
of TariffAdjustments
will adviseBIWTCmanagement
on the optimumstructure
The consultants
achieveat a minimumthe
and levelof tariffs,so as to progressively
tariff increases(over September1989 tariffs)agreedbetweenthe
Governmentand IDA for the FourthPlan period (i.e.,by June 1995).
Theseagreedtariffincreasesare basedon BIWTC'scost structureas
changesin the inputprices
at September1989,and any significant
(for labor,fuel, etc.) shouldbe adjustedfor. In designingthe
will be to make each profitcentercompetitive
tariff,the objective
and in generalfinancially
viable;in the case of coastalpassenger
services,the tariff establishedwould also considerthe direct
subsidyprovidedby GOB for this socialservice.
FourthFiveYear Plan Investments
(f) Coordinating
worth
is estimated that BIWTC will undertake investments
approximately
US$60 million over the Fourth Plan period. These
wouldbe financedby varlousbilateraland multilateral
investments
agencies,and are expectedto includeinvestmentsins two Ro/Ro
vessels, two coastal passenger
ferries, three inland passeniger
of
capitalexpenditures
for rehabilitation
vessels,and miscellaneous
of miscellaneous
equipmentand spares,
existingvessels,procurement
and implementation
of improvedtelecommunications
systemsand fuel
consumption
monitoringsystems. The consultants
shallassistBIWTC
managementin coordinatingthe smooth implementation
of these
and in providingtechnicaladviceon the selectionof
investments,
equipmentand vessels.
appropriate
It
In additionto the aboveongoingresponsibilities,
the managementconsultants
shall,at the end of 18 monthsfromtheirappointment,
preparea reporton each
of the 5 profit centers. The reportwill
assess future prospectsfor each profit
-89-
AnAM.is
Page S of 4
of thatprofit
center,and will recommenda strategyfor the futuredisposition
center (either retention by BIWTC, or divestment of its assets, or
and will prepare a plan of action for implementingthe
privatization),
strategy,the MC
strategy.Upon approvalby BIWTCof a recommended
recommended
termof their
the strategyoverthe remaining
shallassistBIWTCin implementing
contract.
D. Responsibilities
of the 6overgmnut
BIWTC, will make availablefor the sole use of the Management
4.
and all
furniture
officespace(including
adequate
and theirpersonnel
Consultant
servicesfor theseolfices).BIWTCwill not provide
operationand maintenance
theseshouldbe arranged
personnelor theirfamilies;
housingfor the consultants
and paid for by the consultants.
of work, all available
BIWTC will provide,from the conmencement
5.
three technical
following
and data, and will assignthe
relevantinformation
to the ManagementConsultantes
counterparts
(a) Planning officer competentin all aspects of BIW'C commercial
operationsand planning systems, includingmanpower and fleet
planning;
Architectofficercompetentir.all aspectsof BUTC
(b) Engineer/Naval
and
and operations;
fleetmaintenance
(c) Financialofficer competentin all aspects of BIWTC financial
operations.
technicalstaffwill work closelywith the management
The above counterpart
on a day-to-daybasis and shouldbe officerswith the requisite
consultants
areasof competence.
authorityto make decisionsin theirrespective
Exemptionof Taxes,Duties,Etc.
The Governmentof Bangladesh(GOB)undertakesto exemptthe MC from
6.
imposed
or bearthe costsof any taxes,duties,fees,leviesor otherimpositions
nationallyor locally,on the MC and their
under its laws and regulations,
for payuentssuchpersonnelmay
personnelwho are not citizensof Bangladesh,
with the executionof theirservicesincluding:
have to make in connection
(a) incomeearnedin Bangladeshfor work on the project;
(b) equipment,materials,books and suppliesbroughtby the MC into
Bangladeshfor the purposesof executionof work on the projectand
of the serviceson the projectshallbe
which, at the termination
takenout of the country;and
(c) personal property brought into Bangladeshand which will be
upon the departureof suchpersonnel.
repatriated
-90AnneX 13
Page4 of 4
Custo.
s
7.
Visas
GOB also undertakestos
(a) facilitateprompt clearancethroughcustom of personalpropertyand
equipment,materialsand suppliesrequiredby MC's personnel;and
(b) provide the MC's expatriatepersonnel and their dependentswith
multientryand exit visasand the requiredresidentpermitsand travel
documentsas needed for their stay in Bangladesh.
B. Resgonsiblities
of the Consultant
8.
The MC shallmobilizehis personneland commencework within 45 days
of receivingofficialnotificationof award. The MC sa11 providethe services
as outlinedin paragraph6 above for the period up to June 30, 1995, and shall
proposean appropriatestaffingof tk. projectto meet the requirementsof the
contractthrough the end of this period. The consultantis also encouragedto
utilizequalifiednationalconsultantsin staffingthe project.
9.
For efficientperformanceof the study, the MG will procure three
microcomputersalong with appllcableaccessories,and one vehicle.
10.
The MC wlll also providea photocopier,a typewriterand appropriate
commercially available
software and a project library.
11.
The MC will be expected to make hls own arrangements
for housing.
communications and anyt¶hing else required
for the efficient
conduct of the
project.
Tme scheduleand eprts
12.
Upon mobilization(within45 days of award), the MC will preparean
InceptionReport settingout the currentstatusin each area of the consultant's
responsibility,
the generalstrategyand key activities. This InceptionReport
will be submitted to the GOB, BIWT and IDA within three months of mobilization.
Subsequently,
the consultant
shall prepare the following reports.
(a)
Quarterly
activities
status reports
as ldentified
which briefly
summarizes the status
in the Inception Report;
of key
(b)
Annual progress reports which detail accomplishments over the previous
year, problemsencountered,
recommended
ctursesof action,responsible
individuallentity/agency
that shouldundertakethe action,and timing
of such actions;
(c) Report on futuredevelopmentldivestmentlprivatizatLon
of each profit
center--thisreport is to be presented18 months from appointmentof
the MC; and
(d) A Final Report at the end of the contract.
All reports should be produced in 20 copies in English and distributedas
followst BIWTC (10 copies),Mninstryof Shipping (5 copies),Infrastructure
DivisLonof PlanningCommission(2 copies),IDA (2 copies),and one copy is to
be submittedto the ProjectDesignand Coordination
Consultants appointed for the
IWT-ITIProject.
-91-
Am=.: 14
Page 1 of S
THIRDlIZAR VATZU APU
a
ProlectNon±tor"t and Suelvisios Indieators
1.
The following is a list
of project
monitoring
Indicators
for each
calendaryear over th* life of the projectwhich would be revisedand discussed
manuallywith IDA. They are based on the variousprojectcomponentsand agreed
action plans.
The mid-term review, to be carriedout In early 1993, vUl review
accomplisbments .. r 1991 and 1992.
A. RMesurret
Sadi Al
I..tI.
Inbcuer nt i *lloe
Inc
1. VIUTA
(TakeM
2.
l
Iion
e)
dOD
250
elWTC
(TakrMillons ......................
)
S. DOS (TakeMillion)
........................
40
400
400
10
10
to
10
so
70
s0
s0
500
10 10
so
o60
Theabov *Illocatlons
wiIIbe mad in*ccordtn
withoos
budgetary
procodures.
1. Establiab
Dredging
Unit.................... C
2. Appointoembr of the Board,Planing*nd
ope tions....................
8.
Awardcontratfor Operations
mp.TA
4. Absorb 0Ostafffrm lTC
5.
,
Tr*nOfr .PYCtoCOS
.
C
C
C
.......
.
.......
C
S. Transfer
vesseldesignapproval
to DOS.....
7. Finonciol
Covnonto
- Aecountsrecelvable
positlon
(months)
- Tariffreviewandminloumincrease
adjusted
for Ir.flotiont
X)
-Not PositivOperting Surplu
.
- Valuation
of Stocksot Ine ntory
- Saleand Disposlof Surplus
Inventory...
8. Revalueassts,stocksand sp
r.
.
9. Independent
audit
C
6
5
4
4
4
4
s0
iS
12
4
0
8
X
X
X
X
C
C
C
X
X
X
X
X
X
2n0
210
170
S0O
1i0
20
*0
*0
C. elWTCStrreincPios
1.
c
AwardSIWTClit.Cons.Contrt .
2. Fleetrestructuring
(# of ve
el..
)
S. floebrehabilitation
-Deseignatvesslsand Prequirement.
Co plotionof rhab. progrm (
))
C-
4. Establish
profitcenterswithseparate
finaneialaeounts
JCO
C
C
C.......
Leemds C WComwlete";
a Flnish;$
S v ftut;X * Aessel_q irss.
20
Anne 14
-92-
Pop
Oan
S. TransferBarisal
C.............
woekehop
to
0. Transftr600 staffto BIWTA
.......
.
8. Early retiremontprogramfor 1,000.t.ff...
C
S
F
C
..
r *......
11. Independentsudit ................
C
X
12. FinancialCovenants
- (Deficit)/Surplue
at PY end
(Tk )illIons)
........................... (2
- Acot.. r elvable position(months)
- Tariff reviewand minmlun
Itncrasesadjustedfor inflation(
15
- Aot PositiveOperatingSurplus
- Valuationof Stocks of Inve*tory
.........
- Sale and Disposalof SurplusInmentory...
1.
0S
Intitationl.vggW*
P
S
Df ing facilltioe
dbevlopmnt nods ........
C
- Implement
fuelmonitoring
system
*........
10. Revelueassets,stocks and spa
030
on
C
7. TransferO60 staffto OQS................
9.
0on
an
2 of S
1
5
X
X
X
8
4
4
4
12
4
6
X
5
X
0
X
0
80
80
so
C
8.5
4.5
5.5
6.0
t10
X
2...........
C
C
Action P la
1. TakeoverOPTC from BIWA..
C
2. Estab.InlandShip SafetyAdministration
C
S. ImplementEnvironmental
component
.S
F
E. InlendPontoonCoonest
1. Awardcontractfor construction
and Installation
of pontoons
.C
2. Pontoondeploymentschedule(Noe.)
F.
edMIse CAPOr"1osanXI
Icowsmrt
1. Designate drodge asstandby.
.C
2. Refurbish6 dredgs.................
S
8. Inventory
dredge spars...
C
4. Establishdrodgemaintenanceschdule
and Inspection
progrm
..
C
S. Implementcomputerized
dredgeequlpmnt
inventorycontrolst.
sys ...................
S
F
F
6. Establishdredgematerials
testinglaboratory
........................
C
T. Estab.dredge operatortrainingprogra....
C
8. Performancelndlcators
- Throedredgeseach averaging8S,000m
prod. per week duringSept.to March.....
- Fivo dredgs reachabove prod. ratg......
- Output of BITWA dredges(Millon
m)
2.5
- Thre dredge operatinga shifts
6 days a week.
C
- Fiv dredge operating8 shifts
6 days a week..............................
Lnogmds C * Comploted F aFtntish; aStart; X Aa
*
C
8.0
C
I Rs
lroemeon.
-93-
Amex14
ftge 3 of S
sm
n
ofCT"
az
0. Aldo-to-Navcvts
ton Ousrattlonol !msr.v.ants
1. Dry dock a repair buoy tendor alnIichao. .
C
2. Dry dock & repairbuoy tenderPothfinder
C
.
Eatabtllhmaintenanceshlsule and
inspection
programfor buoy tender ... s.
C
4. Establishdistress frequency monitorlng
at Chlttagong, Mongle and Dhakk.a****
......
5.
6.
Award Contractfor NcvigationclAids
Componentof Project
...
...
.. . .
Replace76 percnt of Acetylon
lightswith solar powerd lights
C
C
e
...
7. Procureand Install80 lF trancelver
on BIWTA vessls .
.
.
S. EstablishcomputerizedInventoryof
Aids-to-Navisation
& telocomequlpmetn .
C
S
9. PerformanceIndiestors
- Cloas I A II waterwayoup to IALA
standardfor day/nightnavigtolon(X)....
40
- Averagetrsnsottime based on 100
,'ampie survey duringdry season:
Dhaka - Chittageng route (bpr) .6..
.
Ohoko - Khulna route (hr ......q
e)
.......
Dhak - Baghabartroute (hre)
Dhaka - Chattekrout (b)
.
..............
M. HYdros
P.
70
lCO
1
24
5...........
24
ahl
su oma tmrrt,onol
1.
Transfer control ef selected survey v-nsels
from CP Dept to Hydrography Dept .C
2
Establishsurvey vesvl maintenance
scheduleend Inspectionpr4gram
.C
3. ReconJittonsurvey vesselSabndh
n
4. Establishbranchoffice - South (Barlssl),
Southwest (Khuln.), Northeast (Bhatreboazr)
C
C
S.
Procure hydrogrophic
surveyworkboto.
C
6.
ProcureB accommodatlon
barge & provide
to branchoffics...
C
7. Carryout studyfor ElectronicPosition
FixingSystem.
C
S. ProcureEloctronicPositionFixingSystem
banedon the tudy ,.S
9. PorformancoIndicators- percentageof
surveyaccomplished:
- inlandsurveyAxis 8,700 km/sounding
80,000 km (5/) .40/25
- dredgingsurveyAxis 250 km/sounding
12,000km (X/.) ,60/50
- coastalsurveyAxis 19,C0 km/sounding
29,000 kmX (%/X)
.15/1
Leg
F
60/40
75/7p66/8t
90/90 9S/95
6"/6o
75/765.U6/6
90/00 9t/96
80/25
50/60 75/75
90/90 95/95
tnds
C * Comlptsod;F a Finish;$ a Start;X a Amoel Reqimre
ot
-94-
Annex 15
Page 1 of 1
DANOLADISH
TgIRD INLANDVATRRTRANSPORT
PROJECT
ProJectNAmitorinp
Unit RXsponsibilities
1.
The ProjectMonitoring
Unit (PHU)willbe responsible
for coordinating
implementation
of the project,monitoringprogress,and liaisingwith the
Ministryof Shippingand the variousdonorson projectmatters. In particular,
the PMU will be responsible
for conductingall reviewsof the project,and for
(PDCC),
overseeing
the work of the ProjectDesignand Coordination
Consultants
as head of the PMU.
who will reportdirectlyto the ProjectCoordinator
QuarterlyProgressReport
2.
At the conclusionof each three-monthperiod, the PMU with the
assistance
of the PDCC,will preparea progressreportcoveringthe workdoneon
each of the componentsof the project to date, and detailingactual and
anticipatedprogress,actual and estimatedccsts for the work completedand
disbursements
fromthe Creditcomparedwith thosein the AppraisalReport. The
reportwill highlightcauses for delays,if any, with measuresproposedto
overcomethem,andwillanticipate
any changesthatappearto be necessaryin the
projectcompletion
date,the Creditclosingdate or the projectcosts. Details
willbe givenof contractsfor works,goodsand servicesthathavebeenawarded,
invitedor receivedduringthe reportingperiod,with reasonsfor any changes
thathavebeenmade in the projeetestimatesof implementation
time,quantities
or costs. Two copiesof the quarterlyreportwill be sentto IDA throughthe
Bank'sofficein Dhaka,withinsix weeks of the end of each reportingperiod.
ProjectCompletionReport
3.
Withinsix monthsof the completion
of the projector its closing,the
PHU will submitto the Association,
a ProjectCompletion
Reporton the execution
and initialoperation
of the project,its costsand benefitsderivedor expected,
an assessment
of the performance
of consultants,
contractors,
BIWTA,BIWTC,DOS
and of the Association
on theirrespective
obligations
and the accomplishment
of
of the
the purposeof the Credit. Detailsof the contentsand requirements
ProjectCompletionReportwill be diicussedand agreeda yearbeforecompletion
of the project.
-95Annex 16
Pae
81 of 10
THIRDINLAUND
WATER
TRANSPORT
PROJECT
BangladeshInland WVter Transport
AuthorLty
Fiuancial Perfotmance
underthe Ministryof
BIWTAoperatesas a semi-autonomous
organization
1.
Shipping,and is 100 percentownedby the Government.As of June 30, 1989,its
net worth, which consistsof Governmentequity,foreigngrantsand various
reserveswas Tk 1,013.2million. The auditedaccountsof BIWTA are shownin
yearsendingJune30, 1984to 1988.
Tables1 to 3 of thisannexfor the financial
accountsfor the years1984to 1988are
^.
BIWTA'sincomeand expenditure
has beenerraticoverthe fiveyears,with
shownin Table1. Revenueperformance
dropin 1986,
an increasebetween1984and 1985 (352),followedby a significant
by 28 percentin 1988,to 1985levels.
onlyto increase
afterwhichit stagnated,
to recoveryin port and dredging
The increasein revenuein 1988 is attributed
afterthe
revenue,which increasedby 49 percentand 88 percent,respectively,
drop in 1986 and 1987. As a result(alsodue to increasedgovernmentgrant
allocation
in 1988),the annualnet lossdroppedfromTk 48.3millionin 1987to
Tk 5.3 millionin 1988. BIWTA'sexpensesincreasedfasterthanrevenuebetween
growthin revenuebetween1986and 1988
1984and 1986. however,the significant
reversedthis trend,so that over the fiveyear period,the averagegrowthin
revenuematchedthe growthin expenses.Most of the increasein expenseswere
fromstaffcostsand relatedexpenses.The annuallosswas however,understated
duringthe period. BIWTAhad ignoreddebt servicing,
and the GOB had not made
any efforts to enforce interest(and principalrepayment)from BIWTA. If
interestis estimatedon the basis of existingstandardloan terms,annual
interestchargeswould be aroundTk 40 millioninsteadof Tk 2.1 millionfor
1988. The situationis complicated
furtherby GOB's practiceof withholding
annual developmentbudget allocationsto BIWTA (and other public agencies)
apparently
to offsetoutstanding
interest
and debtobligations
fromthe agencies.
The financialstatementsthereforecannot reflecta true pictureof BIWTA's
financial
position. Suchpracticesencouragedebtservicedefaults,and affect
the implementation
of the annualdevelopment
programinvestments.
3.
BIWTA'sRevenuesand Collection:The majorsourcesof revenueforBIWTA
consistof (a)port charges;(b) conservancy
fees;(c) pilotagefees;'d)canal
charges;and (e) dredgingcharges. Port chargesconsistmainlyof berthing
chargesfor veesels,landingand shippingchargeson goods,terminalcharges,
feesare chargesrealized
etc. Conservancy
leaseand licenseof launchstations,
river
by BIWTA for providinginlandwater servicessuchas aids to navigation,
fees are assessedannuallyon the basis of
trainingworks, etc. Conservancy
estimatedvesselcapacityand are payablein quarterlyinstallments.Pilotage
fees are chargedfor pilotageservicesprovidedto vesselowners,while canal
and upkeep of the
chargesare chargedto vessel owners for the maintenance
canals. Dredgingcharges,on the basisof which BIWTAreceivesan allocation
are fixedon the basis of BIWTA'scost of dredging,and
from the Government,
sometimesincludea mark up. Usually,BIWTA'scost of dredgingis based on
volumesof dredgingestimatedfor the followingyear. Ti se tollsand charges
-96Annex 16
Page 2 of 10
have not been revisedfor a numberof years,and currentlydo not reflectthe
tariffincreaseis therefore
unitcostof providingtheseservices.An immediate
necessary,followedby periodicreviewsand revisionsto enableBIWTAgenerate
sufficient
revenueto coveroperating, maintenance
and administrative
costsof
providingthe revenuegeneratung
services.Underthe propoeedproject,IDA will
whichwouldbe
seekan initialtariffincreaseof 30 percenton all operations,
a conditionof Boardpresentation.Table4 of thisannexshowsthe existingand
proposedtariffchargeson someof BIWTA'sservi4es.
for collection
4.
Revenuecollection
has beenpoor and BIWTA'sprocedures
are unsatisfactory.Port charges,like berthing,terminaland other feesare
supposedto be collectedin cashat the terminal.However,BIWTAallowscertain
creditterms,and paymentis always
publicagenciesand someprivateoperators,
charges,which
delayedor ignoredaltogether.Thisalsoappliesto conservancy
are supposedto be paid quarterly.BIWTAhas no policyto enforcepaymentfrom
At June 30, 1988,accounts
theseoperatorsand arrearshave beenaccumulating.
receivables
were Tk 124.3 million (63 percentof revenue). Recently,BIWTA
established
measuresto reducethe levelof arrears,whichincludea cashcoupon
systemfor pilotagefees,and a requirement
thatvesseloperatorsshouldclear
any outstanding
arrearsto BIWTAbeforethey can have theirvesselsinspected.
substantially,
andwill resultin
This is expectedto improverevenuecollection
a significant
reductionin arrears. Underthe proposedproject,thesemeasures
will be enhancedand BIWTAwill be requiredto reducethe levelof arrearsto
about threemonthsof revenue.
S.
BIWTA'sbalancesheetsfor the financialyearsendedJune 30, 1984to
1988 are shownin Table3. The balancesheetshowsa modestgrowthin assets,
of about 5 percentbetween1984 and 1988. These assetshave been primarily
financedby a combination
of Governmentand foreignloansand grants. Someof
the loanshave been convertedinto equity;and the debt to equity ratio is
satisfactory.
This is because the annual developmentbudget allocationsby GOB
for developmentprogramsare in this case, treatedas additionsto equity.
However,the level of long-termdebt (which,at June 30, 1989 was Tk 883.8
million),is cause for concern,if BIWTA is to repay its existingdebt and
undertakenew debt. BIWTAhas not made any effortto serviceany of the loans.
IDA will seek agreementwith GOB and BIWTA to rescheduleexistingdebtover a
periodof 20 years,beginningin the FourthFive-YearPlan (FY91),at 9 percent
of the
will be a conditionof the Boardpresentation
rate. This requirement
proposedproject.
6.
BIWTA'sexcessivecurrentratiodoesnot reflectthe correctliquidity
stocksof inventory,
someof
situation.This is becauseBIWTAhas accumulated
withBITWAofficialsindicated
whichare now obsolete,or unusable.Discussions
of adequatestocks
that the companydoes not have a policyfor the maintenance
and spares,and has not carriedout a physicalverificationof the stocks
reflectthe
available,
so thatthe valuesin thebalancesheetdo not necessarily
recoveryactionplan,BIVTA
actualvalueof the stocks.As partof the financial
will revalueits stocks'ofinventories,
and selloff all obsoleteand nonusable
includesomeamounts
stocksby PY93. In addition,BIWTA'saccountsreceivable
that have been outstandingfor severalyears, and recoveryis now unlikely.
About 50 percentof these are owed by other public agenciesor government
and
departments.This problemprevailsin most publicagenciesin Bangladesh,
requires a coordinatedeffort by the Ministry of Finance to offset the
-97Annex 16
Pags 3 of 10
receivablesof one agency againstanotheragency'spayables. As discussed
earlier(para4), BIWTAwill be requiredto reducethe levelof arrearsthrough
writingoff uncollectible
arrearsby enhancement
of collection
methods,withthe
objectiveof reducingaccountsreceivables
to aboutthreemonthsof revenueby
FY93.
A. Accountingand Control
7.
BIWTA'saccountingsystemand controlproceduresare generallypoor.
Someof the deficiencies
includenoncompliance
with accounting
standards,
delays
in updatingof monthlyaccountsand completionof annualaccounts,and poor
receivables,
inventoryand fixedassetaccounting.In 1982,an accounting
and
financereviewof BIWTAwas conducted
with IDA assistance
to provide TWTAwith
changes
appropriateaccountingprocedures,manuals, and the organizational
requiredfor an improvedcommercialaccountingsystem. However,progressin
and
implementation
of the recomuanded
changeshas been limitedand deficiencies
weaknesscos
stillexist. The reviewalso developedan internalauditmanualon
the basisof a revisedaccountingsystem,which,doesnot seemto be followed.
8.
The auditorshaveconstantly
spelledout the deficiencies
in the notes
to the auditstatements.Some of the most commonare:
(a) that the balance sheet is drawn each year without physical
verifications
of fixed assets,storesand spares;as a result,the
balancesheetdoesnot presenta truepictureof the financialposition
of BIWTA:
(b) the accountsare not maintainedconsistently
everyyear;
(c) sometransactions
in the accountslacksupporting
documents
or records;
are not preparedon the basisof the ageingof
(d) the accountsreceivable
the accountsand are classifiedintogeneralsubsectors;
as a result,
it is impossibleto ascertainand followup individualarrearsfor
collection.
of the
9.
Discussions
with BIVTAhave indicatedthat the recommendations
accountingand financereviewwere not fully implemented
becauseof lack of
senior skilled and trained staff in the accountingdepartment,due to a
Government
freezeon recruitment
in publicagencies.At present,BIWTAis making
effortsat implementing
accounting
reforms,and underthe proposedproject,GOB
will agree to the employmentof more staff,with the implementation
of the
Operational
Improvement
ActionPlan.
B.
Budgetingwad Audits
10.
As is requiredfor all public agencies,BIWTAmust submitan annual
budgetto GOB for its approval.The budgetincludesthe revenueand expenditure
of BIWTAin the firstsixmonthsof the current
estimates
basedon the operations
year. Due to the lack of a well trainedplanningstaffand an improveddata
base, the budgetingproceduredoes not providemanagementwith the financial
-98AmnexIf
Page 4 of 10
management
criteriato judgeits performance
and takecorrective
action,,which
has contributed
to its past inabilityto achievesatisfactory
operatingand
financialperformance.
11.
As requiredby the Government,
BIWTA'saccountsare auditedannuallyby
a teamof externalcharteredaccountants.Delaysin the completion
of accounts
havealwaysaffectedthe timeliness
of the auditand sometimesthe auditreports
are issuedover a year afterthe end of the financialyear. The auditreports
containadequatedetail and notes on the accounts,have alwayspointed out
generaldeficiencies
of BIWTA'saccountingsystem.
C.
Financial
Recovery Action Plan
12.
As part of a program to improve its performance, BIVTAis committed to
undertake a series of measures to reversethe deteriorating
trendof the pastfew
years. Thesemeasureshave the backingof GOB, and some of them have already
been implemented,
e.g., the coupon system for pilotage services,and the
requirement
thatvesseloperatorsshouldpay arrearsbeforetheirannualvessel
inspections.It is clear that these actionswill have a positiveimpacton
BIWTA'srevenues,and a sustainedeffortis requiredto introducelong-lasting
efforts. To summarize,
BIWTAwill implementthe followingactionsin a ianner
satisfactory
to IDA and reviewits financialprojections
with IDA annuallyt
(a) revise tariffs by 30 percent on all operatius initially,and
thereafter
annuallyreviewits tariffstructure
and implement
increases
to ensurethat revenuefromoperationsprogressively
coversfullcost
of operationand maintenance
includingdebt servicesand depreciation
by 1995,after takinginto accountGovernmentbudgetallocations
for
nonrevenue earning operations;
(b) reviewbudgetallocations
for nonrevenue
earningoperations(dredging
and hydrographic
survey)and agreeamountsconsistent
withwork plans;
(c) implementan action plan to write off uncollectible
arrears,and
measuresto improverevenuecollectionand reduce the level of its
accountsreceivables
to about four months of revenueby the end of
FY93;
(d) to crrryout a valuationof all stockand sparesby end of FY92,and
sell off or otherwisedisposeall obsolete,damagedand mismatched
stocksby end of FY93;
(e) createseparateaccountsfor revenueand nonrevenue
earningactivities,
have its accountsauditedby independent
auditorsi.e.,professional
charteredaccounting
firm,in accordance
with Article4.01 (b) (i) of
the Development
CreditAgreement;and to furnishcopiesof the audited
statements
(to consistof balancesheet,incomestatements,
sourcesand
usesof fundsstatements)
as soonas available,
but not laterthansix
monthsof the end of each fiscalyear;and
-99-
Annez16
Page 5 of 10
(f) GOB will rescheduleoututandinglong-termdebt over a periodof 20
yearsbeginningin FY90191with interestpayableat an interestrate
not exceeding11.5 percent, and convertingoutstandingdebt and
interestpayableto equityso as to adjustfor any differencein the
interestrate established
from the presentweightedaverageinterest
rate of 9 percentrate on existingdebt.
D. FlnancialProjections
13.
Basedon the implementation
of theaboveFinancial
RecoveryActionPlan,
projectionshave been prepared for BIWTA's finantialperformance. The
assumptionsused in making the projectionsare summarizedbelow, and the
projections
are presentedin TablesI to 3.
K. AesUptilons
for Financ.ol Projections
14.
Revenuest Increasesin Governmentgrants are assumed to reflect
increasedoperations
for dredging,aids to navigation,
and hydrographic
survey.
The estimates
were providedby VRC consultants,
who assistedin preparation
of
the project. Port trafficis assumedto increaseby 8 percentp.a.,whileC &
P, Canal,and otherrevenueis expectedto increase
by 7 percent,7.5 percentand
5 percent, respectively. This is based on the historicalgrowth of the
respective
revenuesources.
15.
Tariffss It is assumedthatBIWTAwill implementa tariffincreaseof
about30 percenton all revenuesourcesin the FY91,and thereafterfromtimeto
time,to initially
coverfullcostsof revenueearningoperations,
and eventually
to partlycovernonrevenueearningoperations.
16.
WorkingExpensesreflectincreasedoperatioAal
activityfor dredging.
hydrographic
surveyand aids-to-navigation.
The figuresare basedon estimates
providedby WRC consultants.
17.
Salariesandwagesare assumedto increase
by 10 percentannuallyexcept
in FY91,when they increase
by 24 percentand 21 percent,respectively.
This is
to reflectthe employment
of 600 more staffas outlinedin BIWMA institutional
actionplan.
18.
Administration
expensesare assumedto escalateby 10 percent.
19.
Depreciation
is on a straightline basis with rates rangingfrom 5
percentto 20 percentfor different
groupsof assets.Thisapproximates
to about
4 percentof averagegrossfixedassetsin operations.
20.
Interestchargesare based on interestrates of 9 percentp.*. for
existingdebt,whichis assumedto be rescheduled
over20 years,and 11.5percent
p.a. for new debt.
-100-
Annex 16
Paoe 6 of 10
BalanceSheet
costs.
are basedon historical
21.
Grossfixedassetsand work-in-progress
to fixedassetsare addedto work-inIt is assumedthat60 percentof additions
progress,and the rest is addedto grossfixedassets.
assetsare develo:% .tdredgingwork,which is treatedas
22.
Development
a non-depreciable
asset.
Accountspayablesare assumedto be reducedfrom6 monthsof revenueto
23.
aboutthreemonthsof revenueby FY93.
are assumedto be 12 percentof gross fixed
Stocksand inventories
24.
assetsin operations.
are assumedto increase
and advancesand otherreceivables
Prepayments
25.
by 5 percent.
new debt. It is assumedthat
26.
ForeignLoansfromFY91onwardsrepresent
and BTWTAW. be
loanswill be rescheduled
all existingforeignand government
responsible
to GOB for debtservice.As a result,all existingdebt is shownin
as government
debt.
the projections
are assumedto be 2 1/2monthsof non-cashexpenses
27.
Accountsreceivables
(e.g.,fuelsand oils,operatingsupplies,etc.)
28.
are assumedto increaseby 15 percent.
Other liabilities
Sources and Application
of Funds
costsare basedon projectestimatesto be
BIWTA's capitalinvestment
29.
undertaken during the Fourth Five-Year Plan, and incorporatethe bank's
factors for foreign and local components.
escalation
to meet principal
reflectBTWTA'sobligations
Debt serviceobligations
30.
repayments
on both existingand futuredebt. Existingdebt is assumedto be
rescheduled
over 20 years beginningFY91.
AhIIM 1d1
II7ER SRT 13198A3ITY
ktul ad Frercnt I1r ad Evediture
Statuents
F.?. esdin Jumn30
194
1985
1966 1187
1988
- t----litee--I
45.0
t919
199
ttus~loo.)t
1
192
t
69.0 106.5 110.4 125.7 tS.9
53.0
20.0
4.2
3L1
29.
56.7
21.5
4,6
39.9
30.7
28.0
Pertavin
t *? 15.2
me
Crnl lNle
braim tavrn.
Otitertace
39.6 64.9
30.6
5.3
3.3
70.2 71.3
16.9 29.3
Tol bR s
147.4 199.4 14.9
94.2
22.7
4.9
75.2
9.5
153.4 196.5 191.5 225.2 265.1 35
Ofshich:6ot AIIec. 1
MintonaacDredqinq
OIlier:
Fuel
I Oil
Ualatemne
i Rairs
riating
Spplin
Otber
DirectSaies
Saaries I Res
Ainistration
rtlin Etasn
202.5 20.1
81.6 100.0 142.6 15.0 239.1
15.9 17.0 23.7 31.9 36.4
8.2
8.8
12.2 16.3 19.5
79.8 65.8 92.2 ".1
106.6
13.0 13.7 14.4 15.1 15.9
175.4 244.4 200.5 222.4 303.0 308.9 350.9 44.0
01t.LIESE
50.0
15.0
15.0
15.0
40.0
22.8
3.8
2.9
9.5
44.2
16.2
42.6
24.4
4.1
3.0
10.2
70.9
17.2
39.1 40.3 51.2 44.7 43.0
21.7 23.0 29.3 25.9 47.0
3.6 3.6 4.9 4.4
4.7
2.7
2.9 3.7
2.9
3.6
9.1 9.6 12.2 10.5 11.6
97.7 101.3 100.3 106.0 116.6
15.4 16.4 20.8 19.0 20.1
hrecliatin
34.0
Operat Eqt.s
13.4
0.0
j
t
28.4
34.9
51.0
54.8
l.9
63.4
36.0
44.9
223.4 2462
1.6
4.4
44.2
49.0
4.2
45.5
53.1
9I
-
294.9 33.7
33.1
m.3
296.
2.9
46.2
21.7 23.3
14.6 123.2
16.7 '7.'
336.3 368.3 403.4
S.1
54.
59.1
25.6 27.4 29.3
26. 12.9 126.9
18.4 19.3 20.3
33.7
33.7
466.2 506.2 55.3
68.6
763.1 646.9 197.0 935.5 977.7
U.1
73.2
71.1
4!2.1
76.7
51.5 55.3 59.3 63.7 66.3 71.7
49.9 56.2 59.5 69.4 79.5 93.4
5.1
5.5
5.9
6.3 6.6 7.2
3.7
3.9
4.1
4.3
4.6
4.8
12.7 14.0 15.4 16.9 19.6 20.5
121.3 159.1 193.0 212.3 233.5 256.9
22.1 24.4 21.6 29.5 32.4 35.7
41.5
-
419.5
4U.1
61.5
475.7 521.4 SS.6
73.1
64.5
9.s
596.6 639.0
402.1 402.1
71.7
78.7
74.2 76.9
B5.3 86.7
7.6
0.1
5.0
5.'
22.5 24.8
2M2. 310.8
39.2 43.2
595.2 634.4
6.4
91.3
269.9 306.2 311.6 352.0 360.6 434.7 492.7 548.1 606.0 651.3 691.6 M7.
0.9
2.1
0.0
5.7
104.3 132.1 173.3 206.2 225.1 224.1 224.7 224.2
TotalEapeee
108.4 225.2 252.6 270.1 308.3 311.6 357.6 485.1 566.9 666.0
Srpiuesi(Dlcit)
(13.0) 19.2
Itils:
lorting Patio
Operating
Ratio
1n9n 1997
I1
166.9 200.2 250.1 300.3 349.9 40.3
151.4 187.4 203.3 225.7 257.2 264.4 306.4 332.3 31.7
Internt Char
1993 194
--
55.6
tsot Br.ts
(inTataKlillion)
152.11 10.3)
831.1 375.9 9163 956.0
(5.3)
12.70 (6.7) (44.1) (6.6)
2.6
9.1
15.6
21.0
19.2
2.9
0.9
1.0
0.9
1.0
0.6
0.7
0.6
0.7
0.6
0.7
0.6
0.7
0.6
0.7
0.6
O.t
F
0.9
1.1
RtslitIsewrnt
0.6
0.9
1.0
1.2
1.0
1.i
Allocatioconsistsod Sonrt
0.9
1.0
0.0
0.9
0.1
0.8
6rants and90R
of Dredginq
Rlev shidtis financed
y 60.
t
,A
-
n
o
3ULAIESH
I.LNI 3418R
TRUPIT IU ITY
kctul andForecastSmrcn ad Usesof Fuds StMiuuts
1a
F.T. nding June 30
S5U
I15
t1
-At
191
19"
_
1989
itt(1us.
tlh6II
1m
1991
-Kt
(in take Nillium)
192
1993
19S
19
199
19t7
19
OF FM
lcomeLoss) fro
IWpiatimt
AiJustatm
Opratio 113.01 19.2
34.0 A.0
0.9
1.8
TotalFds fromOpuatls
52.1) (6M
44.9 44.3
0.0
0.3
(5.0)
49.0
0.4
(53)
47.2
0.0
6.7) (44.1) (6.8)
45.5 48.5 53.1
0.,0
0.0
0.0
2.6
61.5
0.0
8.1
73.1
0.0
15.8
64.5
0.0
21.0
2.5
0.0
1.2
96..
0.0
20.9
91.3
0.0
100.3 113.5 115.
119.1
21.9
57.0
7.2)
(3.7)
4
41.9
39.9
4.4
46.2
64.2
81.2
Iubumot Equity/Grants
Forip Grants
82.6
13.3
60.4
27.6
59.9
9.2
20.9
0.0
37.4
6.7
10.3
6?
0.0
0.0
27.9
0.0
41.8
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
TotalGrats
96.4
102.0
69.1
20.9
44.1
17.0
0.0
27.9
41.6
0.0
0.0
0.0
0.0
0.0
0.0
Furi
Other
10.8
72.8
2.0
0.0
49.6
2.2
28.1
21.2
1.4
11.7
3.2
0.0
7.1
33.6
0.0
61.4
0.3
0.0
12.5
9.1
0.0
116.9 230.4 X4.7 280.2 170.5
21.4 4.6
56.B 42.6 31.0
0.0
,
0.0
0.0
0.0
19.2
14.9
0.0
29.0
16.6
0.0
36.6
M8.1
0.0
Total horroagle
93.6
51.8
50.7
19.9
40.7
61.7
21.5
14.
-219.0
595.3 322.9 201.5
34.1
45.6
54.7
TOTAL
FI
211.9 216.8 112.6
37.1
129.2 120.6
a
J17.6
367.1 459.7 04.1
WPLICATllN
OFFMiS
Fixedhsets
Delopt Expeditare
luvetmmts
lo Rpayet
*tbr
211.2 50.6 142.1
0.0 139.7 t31.U
0.0
3.1
0.0
0.0
0.0
0.0
0.0
0.0
0.0
30.0
25.0
0.4
0.0
0.0
118.2
40.9
a.0
0.0
0.0
lO.0
I1.5
0.0
0.0
0.0
122.2 244.5 366.7 305.6 163.4
23.0
34.6
26.3
17.3 18.1
0.0
0.0
0.0
0.0
0.0
47.3 47.3
47.3
47.3
46.4
0.0
0.0
0.0
0.0
0.0
TOTIL
USES
211.2
193.6 Il0.5
S
159.I 185.9
21.5
192.6 326.3
23.2
2.1
(183)
129.9)
13.5
(14.4) (3.6)
(12.
(16.3)
53.7
21.2
Emtnv
CulnoMIU&GROH
Lon
awrbnt Las
hkting CapitalMAnWe
Ctu lnrJsIh
e*t SlvicCoveae
t
asl
0.7
15.9
3L4
68.1
0.0
0.0
0.0
(2.2)
442.8 370.1
301.6 147.6 161.2 173.
24.?
15.0
19.1
0.0
S.6
0.0
J1.7
25.6
21.0
0.0
.6
0.0
33.7
21.0
0.0
39.3
0.0f
115.2 144.0
1.7
10.2
36.3
19.4
2.0
(17.6)
m1.3)
3.3
43.6
39.1
6.7
(2.3)
32.6
M5.9
43.7
51.1
7.9
0.7
1.0
1.1
1.1
1.2
1.2
1.2
1.1
,- I'
-
mWum
-
fit lameilhlim)
ktuadas Fwxmt ldam Oneto
199 1
rin hd ts
cutuda herritiem
lbt Fixedats
Vrk to rWus
eats
Isluu
133.
.2
I2.5
65T
9.t
41.t
14
163.5
0.5
1.1
4442
TotalFiJi asse
11.3
12710 1291.14300.4126.3 1360.2134.
1.
mts
Tol L
1W
9I
14
iw
5
I
h of h1.3U
92.2
2064
717.1
107.1
442
1
1072.21102.6114.0 12463
442.8
252. M0. 346.6 3.3
73.5 M.6 751.6 780.4 OL.5
9L2 39.7 97.4 35.2 83.9
501.7 516.0 516.0 527.5 550.5
72.9 219.2 220.6 22L.
a_7 33S18
kemts Ibeltv*le
Stwas
&lautori
Prepyussts
&
6IICfs
Oterw
hbcl fale
tas
77.5 110.2
12.t 129.6
31L. 21.9
45.6& 4.4
39.0 40
TOWtrut
330.7 M.1
keas
ALI
II.2
124.3 124.3
M31 1359 U15.3 M3
.1
23.7 20
2L35
51.0
55.0 5.0
S.I
4.o
35.4 19.1 n.3
9.
34.
I00.0 1793 1370.0
tli som
CM*trihlIm
Fordpbarts
ewI
_a IbsI
kt
li
73L. 019.2
I1.5 141.1
402 414
U12.6)(4.0
%.1
U
223.3 223
16l3
135.1 %.4
17M.2 162.3
50.5 53.0
54.2 569
147.2 9.9
1M
197
11
2306.22257.4221L0
223.3 223.3 223.3 2233 223.3 223.3
1119.22223.22472.9256.
2531.5263.7 S3.1
103.3
16.6
55.7
5.7
23e.0
93.9
260.0
5.5
07
23.7
250.
I0L1
233.1
61.4
65.9
234.
115.5
206.2
64.5
9.1
206.9
129.4
211.0
67.7
72.
320
141.0
2625
71.1
702
33.5
153.0
297.1
74.6
3.0
437.0
70.
75.2
67.3
97.3 W04.0
°
2375.63171.73375.134.9 3446.1340.2
0 1617.0
376.7 39.7 W.0 947.3 447.3 9.2 1017.I 1017.01017.01017.0117. 101.0
164
16.1
16.
1U0.1
164.1 11
104.1 1U.1 10.1
1.7
150.7 7.4 164. 1.1
0.S C5.3 05.3
053
S
3
0.3
1.3
U.3 05.
4.9
55.0 53
3".7112L9 1U6.3)U42.6 (121.7)
1144.4)110.1 11516)(1SI.5$(2U 1249.4 26I)
I
37
101.L21024.91012 1162.01137.01.6
9
270.0 30.1
441.0 497.0 51L.
31L5 2.t
527.1 510.
7sl 1mgTwr U*ilitln
724.0 74
362.9
61.1
19M
1400.01665.9199.9 2249.6'6.6
13.3 204.3 2129.72M2
Ull 1EZ13"
farFul ee7
wuhmt L1s
Ulahihtin
1m4
0.9 171.6 6. 2242.t 2X1.A 24.9 247.0
903.f 162.2
495.9 557.4 M.5 715l. 3
909.01114.4 1353.71527.91574.01534.01473.7
35.1 30.6
171.9 271.0 264.0 169.5 0.0
709.4
55.1 013.9 31.2 04.3 M6M.46.4
017.3 02.4
3.
n UmLmES
bescta Bt 1e
2.4
17.3
ke11 Payile
0.5
lak Isll*dt
_e Uiailitin
40.9
CMt PUtie o.- UKt 0.0
19
410.5 453. 503.3 55.5
Toallt brit
tublrat
223.3 223
129MI 1444? 151.3 1521.0L551.0 150.5 16S
lw huts
192
M
2.4
10.1
0.0
0..
0.0
2.
20.4
0.L
9.
0.0
0.1
63.7
.
104.0 11I3.0 It2.7
136.3 20.4 1.4
557.2 4.6 9.
42LS 79.3 1100.0129.4 130.31343.0 1355.3
731.4 6653 636L
73.2 ML? 04.0 M.
94.5
1290. 1U05.012.
2.4
2.4
2.4
22.4 21.0 30.
0.
0.0
0.4
4.9
40.9 40.9
0.0
0.
0.0
5.9
147.7 10.5
97.6 t1 0
2.4
2.4
47.9 52.0
0.
*
47. 4 1
47.3 47.3
71.3 IUU9 1.
17
2.4
0.9
0.0
.0
02.2
47.3
2.4
P.?
0.
71.5
47.3
2073.72622 222
2.4
2.4
2.4
2.4
65.2 2.3 9.2 I140
0.0 *.0
*
L0..0 0.0
125.1 143
.
12.3 94.0 1.J
MI
4.4
55.0 9.0
9.3 1.1
2.4
n.
.In0 190.9 210.4 237.3
1TtILSIT? S LJIILITIS 162.1 17961l130.0 1370.3198.3 204.3 2129.7m22. 256.
193
g5
..
d
I
*
w
M.1 316.0 361.9
2375. 3171.7'1151 36.9
S4.1 34.2
°
-104-
A&,n.x16
Page 10 of 10
Table 4
BANOLADESI
?iNM lwLJID VAtE TR
Iwiladesh
Inlaad
Rate Structure
Description
A.
Couservac
POaTPROJ,CT
Water Tra4a9ort
of selected
Existing
Authority
BIWA Charg
late
Proposed Rate
Fees
Coasters
Oil Tankers
Other Cargo
Vessels
Tk 39.OO/tonlannum
Tk 88.OOItonlannum
Tk 51.70/tonlannum
Tk 114.40/tonlannum
Tk 14.00/tonlannum
Tk 18.20/ton/annum
B.
PilotageFgee
Tk 12500Jbeat 1/
Tk 162.50/beat
C.
PortCharges
Tk 1.00/passenger
Tk 1.30/passenger
Tk l.5O/maund
2/
Tk 12.00each
Tk 6.00each
Tk 2.00/maund
Tk 15.60each
Tk 7.80each
Tk 1.23/day
Tk 1.60/day
Tk 56.00/day
Tk 72.80/day
Tk 11l.OOiday
Tk 144.30/day
Tk 605.00/day
Tk 786.50/day
Tk 6.00/100
maunds
Tk 7.801100maunds
Tk 1.50/boat
Tk 2.00/boat
(a) Terminal
Charges
(b) LandingShipping
Charjess
(i)Goods
(ii)Trucks/Buses
(iii)Cars/Pickups
(c) Berthing
Charges:
(i)CountryBoat
not exceeding
100 maunds.
(ii)Cargovessel
of up to 100
tons.
(iii)Cargovessel
of over750
and up to
1,000tons.
(iv)Cargovessel
of over3,000
tons.
D.
CanalChagLes 3/
On all cargovessels/
boats
On emptyboatsof 500
maundsor above
1/
2/
3I
A beat is equivalent to eight hours.
A maund is equivalent to 37.3 kg.
The charges are based on use of the Ratherhat
Canal. Chargesfor other
canalsmay not necessarily
be the sams.
-105Annex 17
Page I of 10
PROJECT
TIRD INLAD WATER
TRANSPORT
Jangladesh
Inland Water Transport
Financial
Corparation
Performance
BIWTC was set up with an authorizedshare capital of Tk 450 million.
1.
The original issued share capital includedthe Government'scontributionof Tk
9.9 million to the East PakistanShippingCorporation,which precededBIWC. The
Government of Bangladesh is the only shareholderof BITC. As of June 1989,
share capital amountedto Tk 412.3million,which representsthe originalissued
share capital,and capitalizedannual developmentprogramseallocationsto BIWTC
to finance its capital investmentprogrammes. Equity capital was increasedin
1984 through a conversionof Tk 179.3 million of governmentloans into equity.
A. Past Finuacial
Performance
2.
Table 1 showsauditedincome and expenditureaccountsof BIWTC from 1984
to 1988. The financial statementsshow that BIWTC's operating results have
deterioratedover the period. Total revenuesdeclinedbetween 1985 and 1987 due
to a decline in freight traffic and although they increased in 1988, they had
still
not recovered to 1985 levels. Over the five year period, the average
annual growth in total revenuewas about 2 percent. Cargo revenuesover the five
year period declinedcontinuously,while ferry revenuesincreasedsignificantly.
Total expendituresover the same period increased by 27 percent (an average
annual growth of about 7 percent) and the net deficit increased from Tk 4.9
million in 1984 to Tk 53.1 million in 1988, and accumulatedlosses amountedto
Tk 213.4 million. BIWTC's interestexpenses shown in the income statementsdo
not reflect actual interestdue on its debt, so that the deficitis understated.
As an example, in 1988, interestcharged was only 3 percent of its outstanding
debt; average interest rate charged on similar debt in Bangladesh is between 9
percent-11.5percent. Based on standardrepaymentterms on governmentdebt, and
actual amounts of governmentloans outstanding,the resultingnet loss would be
as follows:
OperatingHargin
Interest
Deficit
1984
1985
1986
1987
1988
0.5
32.1
(27.1)
1.2
32.8
(31.6)
(31.7)
33.2
(64.9)
(46.7)
33.5
(80.2)
(43.9)
34.1
(77.2)
-106Annex 17
Page 2 of 10
Iv addition,the interestexpenseshownin the incomestatementis only a book
entry,and actualpaymentsarenot made so thatinterest(andprincipal)
payments
for foreignloansare made by GOB when and as theybec
due. The Government
has agreedto reschedule
thisdebt and capitalize
the cstanding
interest.
3.
BIVTC'sstructure
of expenses,indicates
thatdirectfleetexpensesare
on average77 percentof t .^ expenses.Of the directfleetexpenses,about30
percentconstituteoperLor,a.staffcosts. Togetherwith other salariesand
staffexpenses,totalat '. :oftsfor BIWTCconstitute
over 35 percentof total
workingexpenses,which iset-ghby normalstandards.
4.
On a sectoral
basis,BIWTC'scargosectorcontributes
to over90 percent
of BIWTC'slosses. These lossesare partly offsetby profito in the ferry
sector. The passengersectoralsomakes losses. The operatinglossesin the
passengerservicesincludelossesincurredin the operationof uneconomic
routes
to the offshoreislands.Lossesin the passenger
sectorare alsoa resultof low
tariffs,and high operatingand maintenance
costs due to the age of the fleet.
Profitability
in this sectorcould thereforeimproveif passengerand ferry
tariffswereenhanced,if the passenger
fleetwas streamlined,
adequatesubsidies
were given for operationof t-heuneconomicroutes, and if efficiencyof
operations
was improved.Subsidiesin the cargo/freight
operation,
on the other
hand, are not justifiabledue to low capacity utilizationarising from
competition
fromthe privatesector. As part of the strategic
plan for BIWTC,
agreementwill be reachedto streamlinethe cargo sectoroperationsto the
minimum (seeAnnex 5) and revisionsof all tariffswill be soughtunder the
project.
5.
BIWTC'sbalancesheetsfor the yeaps1984 to 1988are attachedat
Table3. The balancesheetsshowthatBrWTC'sassetsincreasedin nominalterms
fromTk 1,339millionin 1984to Tk 2,013millionin 1988 (an increaseof about
50 percent). These assetshave not been revaluedin a long time, and the
balancesin the statements
may not reflectactualreplacement
values. Equity
capitaland reservesincreased
by about103 percentover the fiveyearperiod.
This huge increase is due to
two reasones (a) GOB converted some debt into
equityin 1985, (b) BIWTCborrowedfrom the Governmentin 1988 to financetwo
ferries,and this amounthas not been addedto existingdebt,but insteadhas
been addedto reserves,apparentlyin anticipation
of a furtherconversionof
debt intoequity. BIWTC'slongtermdebtto equityratiois low, partlydue to
the conversion
of Government
loansintoequityin 1984/85whichwas designedto
reduce BIWTC's total indebtednessand improve the capital structure.
Rescheduling
of the existingdebt will still be requiredunder the proposed
financialrecoveryprogram,to enableBIWTCto takemore investments
on a loan
basis.
6.
BIVTC'sliquiditysituationhas deteriorated
considerably,
with the
currentratiodroppingfrom2.01:1in 1984to 1.57in 1988. The actualliquidity
maybeworsefor two reasons:First,the accountsreceivable,
whichaverageabout
12 percentof totalnet assets (considered
high by normalstand&rds),
contain
substantial
receivables
thathavebeenoutstanding
for a longtime(in somecases
over ten yearsold),with very littlehope of recovery.Second,the storesand
inventories
also containsome stocksof goodsthat are obsoleteand therefore
have no usableor resalevalue. Some of thesestock4were takenover fromthe
nationalized
companies
in 1972,and theiractualvalueis not known. Discussions
-107Amnex17
Pago 3 of 10
with BIWTCofficialsindicatethat actualusablestoreoand sparesas of June
1988were about50 percentof the value indicatedin the accounts. Under the
FinancialRecoveryAction Plan, these matters are being addressedby BIWTC
throughenhancedarrearrecoveries,
and revaluation
of the inventories.
7.
BIWTC'
s currentliabilities
includeaccumulated
interest
payableon both
Government
and foreignloans,mostof whichhas beenoutstanding
for a longtime.
As of June 30, 1988,this amountstoodat Tk 176.2millionand constituted
24
percentof outstanding
loans. In addition,localand foreigndebtshove been
outstanding
for a long timewith no repayment;as at June 30, 1988,the total
outstandingdebt was Tk 708.7million. Correctionof this situationis the
responsibility
of GOB as well as BIWTC,sincelackof enforcement
procedures
by
GOB has led to accumulation
of thisdebt. BIWTC'smanagementclaimthat there
has been no onlendingagreement
with GOB on the repaymentof foreigndebt,and
thatsomeof the debtsare actuallygrants.Underthe proposedproject,IDAwill
reachagreement
withGOB to havethe outstanding
debtrescheduled
over20 years,
beginningin FY 1991,at 9 percentinterestrate. Thislowerinterestrate,(the
existingrateis 11.5percent)is to reflectan averaging
with the lowerinterest
ratesof earlierloans. IDA will also requirean agreement
with BIVTCand GOB
to convertthe outstanding
interestintoequity.
B. Accountingand Control
8.
BIVTC'sfinancedepartment
consists
of theaccounting
and internal
audit
divisions,and is headed by the Member Finance. The Financedepartmentis
responsiblefor the preparationof: (a) accountingrecords;(b) bills and
invoices;(c) operational
or revenuebudgetsfor submission
to the Ministryof
Finance;and (d) annualfinancialstatements.The-MemberFinance,who reports
to the Chairmanof BIWTC, has limitedautonomyto formulateand implement
financialdecisions.
9.
BIWTC'saccounting
systemis weak. Its shortcomings
includes(a)poor
recordkeeping,which includelack of a completefixedassetsrecord;(b) lack
of controlover accountsreceivable;
and (c) delays in the preparation
and
submission
of financialstatements
for audits. As a result,BIWTC'saccountsdo
not consistently
yielda cleartimelypictureof its financialsituation.Like
mostpublicentitiesin Bangladesh,
BIWTChas insufficient
trainedaccounting
and
financialstaff. Thisis furtherexacerbated
by lackof coordination
betweenthe
accounting
and operations
departments,
which impedesthe timelypreparation
of
meaningful
accounts,
budgetsand development
plans. Duringthe negotiations
of
IDA Credit735-BD(SecondInlandWaterTransport
Project),it was agreedthatto
improveBIWTC'sfinancialstructureand operations,
a reviewof its accounting
procedures
and systemsshouldbe conducted,
to identifyits deficiencies
and come
up with appropriate
recommendations.
The studywas to provideBIWTCwith an
effective
accounting
systemand operating
procedures,
on the job training
for its
accounting
staff,and to defineappropriate
methodsof firnscing
its activities.
Amongother recommendations,
the consultants
preparedan accounting
manualfor
BIWTC'saccounting
unit. Implementation
of the recommendations
has beenslowand
unsatisfactory,
and manyof the shortcomings
identified
in the studystillexist.
-108Annes 17
Page 4 of 10
Theseaccounting
deficiencies
are in the areaof revenueand accountsreceivable
accounting
debtserviceliability,
fizedassetregister
maintenance,
and account
reconciliation.
10.
As part of a financialrecoveryprogram and the organizational
restructuring
in the Strategic
Planto be implemented
by management
consultants,
BIWTCwill conducta fullreviewof all theseoutstanding
issuesto ensurethat
propervaluesare attachedto all the assets,liabilities,
and stocks,designa
policy actiento recoveroutstandingamounts,and a system to avoid future
accumulationof receivables,improvecontrol of accountingactivities,and
providemore trainingto accounting
and financialstaff.
C.
Budget and Audits
11.
BRIWTC
is required to submit annually a budget to GOBfor approval, which
forms the financialplan for the followingyear. This budget includesthe
estimates.
revenueand recurrentexpenditure
estimatesand capitalexpenditure
The budgetsare preparedon the basisof actualresultsof the firstsix months
of the currentyear, and projectedfor the whole year. Lack of appropriate
timely information
for financialdecisionmaking affectsthe qualityof the
annual budget,in that it does not reflectexpectedmedium term changesin
operatingconditions.Also,the planningprocessneedsto be improvedto cover
a fiveyearperiod,basedon realistic
mediumtermtrafficlevels,and financial
forecasts,
to providea basisformanagerial
decisionmaking. Budgetary
control
is also poor, and actual expenditures
are usuallysubstantially
higher than
budgeted
figures.
12.
BIWTCmaintains
an internal
auditdivision,
comprising
twenty-five
staff
memberswho conductfinancialand management
audits. The effectiveness
of this
sincereportingproceduresare not clear,
unit is, however,not satisfactory,
accountingpoliciesand standardsare not enforcedand systemsof budgetary
controlare not in place. Currently,the auditdivisionreportsto the Member
Finance. Thisstructure
needsto be changedto have the internalauditdivision
report directlyto the chairmanto ensure that it operateswith complete
autonomy.BIWTC'saccountsare auditedby two firmsof charteredaccountants,
who issuea joint audit report. The audit reportis acceptableand contains
detailand supporting
information
on the financial
statements.However,despite
the factthatsomeof BIWTC'saccounting
unitshavebeen computerized,
the audit
reportsare alwaysdelayed.
D. FinancialRecoveryActionPlan
13.
BIWTC'sfinancialperformanceneeds improvement,and this will require
the implementation
of measures,which when taken togetherform a Financial
RecoveryActionPlan. Transforming
BIWTCintoa commercially
viablecorporation
will requirea commitment
and concerted
effortof all partiesinvolvedoverthe
nextfiveyearplan. IDA bas beenaskedto supportthiseffort,and the proposed
projectrepresentsthe firststep towardsthis effort,and have assistedBIWTC
in preparingthe StrategicPlan, and the actionswhich form the Financial
RecoveryActionPlan. Actionsunderthe latterwould includes
-109Amez 17
Page 5 of 10
(a) improvedrevenuecollectionby raisingferry tariffsand passenger
tariffs annuallyto generate sufficientfunds to cover its cash
expenses,
including
debtservicecharges,and
operatingandmaintenance
contributeno lessthan 10 percenttowardsannualcapitalexpenditure
by FY95;
(b) reduceoperatingcostsby reduction
on stafflevels,and implementation
of a fuelmonitoringsystemby FY93;
(c) reduceaccountsreceivables
to aboutthreemonthsof revenueby the end
arrears,and
a plan to writeoff uncollectible
of FY93 by implementing
improvecollectionefforts;
(d) revalue and verify all existing stocks and spares on a basis
to IDA by end FY92,and selloff or otherwisedisposeall
satisfactory
obsolete,damagedor mismatchedstocksby end FY93;
Ce) not to incurany new long-term
debtunlessthe debtservicepaymentson
by BIWTC's
currentat1dnew debtis covered1.2 timesby cash generated
paymentsfor the coastaloperations,
including
onlydirectGovernment
passengerservices;
(f) the InternalAuditDepartment
will reportdirectlyto the Chairman;
i.e.,professional
willbe auditedby indepentauditors,
(g) BIWTCaccounts
with Article4.01 (b) ti) of
charteredaccountingfirm,in accordance
the DevelopmentCredit Agreement,copies of audit statements(to
consistof balancesheets,incomestatements,
sourcesand usesof funds
statements)
will be furnishedto IDA as soon as available,but not
laterthannine monthsof the end of each fiscalyear;and
vi) GOB will rescheduleoutstanding
long-termdebt over a period of 20
years beginningin FY90/91with interestpayableat an interestrate
not exceeding11.5 percent, and convertingoutstandingdebt and
interestpayableto equityso as to adjustfor any differencein the
interestrate established
from the presentweightedaverageinterest
rate of 9 percentrateon existingdebt.
S. FinancialProJections
14.
Basedon the implementation
of theaboveFinancial
Recovery
ActionPlan,
projectionshave been prepared for BIWTC's financialperformance. The
assumptionsused in making the projectionsare summarizedbelow, and the
projections
are presentedin Tables1 to 3.
F. a.ssumptions
for FinancialProjections
15.
General: The financial
projections
are in constan-1989terms,and an
exchangerate (and relativeprice) stabilityis assumed. The exchangerate
assumedis Tk 34.22- US$1.00. Only the main financialstatements(lncomeand
Expenditure,Sourcesand Uses of Funds, and Balance Sheet) are presented.
-110-
A=ex
17
a8ge6 of 10
and they provide details
of
Additionaltables are availablein the project file,
assumptionsregardingoperationalexpenses,tariffs and revenue,etc. The main
assumptions
are explained below.
16.
Revenues: The revenuesare based on actual operatingresults for 1989,
and are projected using estimates of traffic growth, based on historical
experience. It is assumed that traffic growth i. the ferry sector operations
will be 8 percent p.a., until 1995/96 when th.s growth drops to 6 percent (due
to the diversion of some traffic to the Jamuna Bridge). Passenger sector
operationsare expectedto grow at 3 percent p.a., and no increaseis expected
in the cargo sector operations. It is furtherassumed that BIWTC will implement
tariff enhancementsof about 15 percent in the ferry sector in 1989/90 (from the
ferry tariff regrouping)and 25 percent in the passenger sector. Thereafter,
BIWTC will revise tariff periodicallyto achieve a positive rate of return on
assets by the end of FY 1995.
OperatingCosts
17.
Fuel and oil expenses are assumed to increaseby 8 percent, except in
FY91 and FY92, when the fuel monitoring system is to be implemented,resulting
in a reduced fuel expense.
Direct salaryexpensesare assumedto declineby 35 percentbetween1991
18.
and 1995, due to the implementationof the staff retrenchementprogram, after
which they increaseby 10 percent annually.
19.
Repairs and maintenancecosts are assumed to increaseby 10 percent in
FY91, and then 20 percent in FY92 and FY93, and 10 percent thereafter. The
higher increase in PY92 and FY93 recognizesthe fact that in the past, repairs
and maintenance has been understated. Other salaries have been assumed to
increaseby 10 percent annually.
20.
Administrationand overheadshave been assumedto increaseby 5 percent
annually.
21.
Depreciation: This is calculated on a straight line basis, with
different depreciationrates for differentgroups of assets. on average, this
approximates to about 4 percent of the value of gross fixed assets. This
percentagehas been maintainedin these projections.
22.
InterestCharges: The interestrate on existing debt (which is to be
rescheduledover twentyyears),has been assumedto be 9 percentp.a., to reflect
an averagingof lower interestrates on earlier loans, and the existingrates on
more recent loans. Interest rate on new loans is assumed to be 11.5 percent
which is the current GOB lending rate to public organizations.
Balance Sheet Projections
23.
Gross fixed assets and work-in-progressare based on the historical
costs, and it is assumed that 30 percent of new additionsto assets are added to
work-in-progress,while 70 percent is includedas gross fixed Rssets.
24.
Investmentsare assumed to increaseby 10 pe;cent
-111Annez 17
P5se 7 of 10
25.
Accountsreceivables
are assumedto decreasefrom 6 monthsof revenue
to about threemonthsof revenueby FY93. Inventories
are assumedto be 7.5
percentof averagegrossfixedassetsin operation.
26.
Interestpayableon loansis assumedto be convertedinto equity
in 199i..
27.
Accountspayableare assumedto escalateby 7.5 percent.
Sources and Applications
of Funds
28.
BIWTC'scapitalinvestment
costsfor the periodincludeinvestments
for
the projects,and otherinvestments
underthe FourthFive-YearPlan,whichhave
been agreedunderthe BIWTCStrategicPlan. Furthercapitalinvestments
shown
in the projections,
beyondthe fiveyear planperiodare estimates.
29.
Debt-service
obligations
reflectobligations
for bothexistingand new
debt. All new debt is assumedto be payableovertwentyyears,with fiveyears
of grace. Existingdebt is rescheduled
overtwentyyears,withno graceperiod.
F.Y. esio
MM
UN
ktul
FGrecatSo
193
I5
t194
uau 30
ITERTlUT
USLAK
Jd
1987
1996
CUWIIlN
tia Ttf UilUlau
Statests
ad Usesof FuadS
1939
13
9
19
I9
19t5
m
199
19
19
NEIS IF FUINS
4.0
4romOprations 34.7
Tot Fands
UIIUUll
EIIT tl&lltllll
Cuernt Brats
fortip
(44.)
41.4
0.0
10.2
(10.3
35.3
0.0
.i
(4.9
i1.7
0.0
7.9
lot ChOALMs)
OWreKeotl
Mjtsts
Itrest Epm.t
(55.0) 53.11 (66.I)
39.3 33.4
40.5
2.9
0,0
0.0
0.0
111.3 1t.2
14.7
3.6
5.4
G
111S
(59.11 (29.3)
702
47.7
0.0
0.0
0.0
0.0
(32.51 111.4) 43.9
9.9
117.5
0.0
0.0
13.9
137.5
0.0
0.0
19.4
12.2
153.7 13
-0.0
L.
0.0
0.0
6.5
32.2
0.0
0.0
3.1
95.4
0.0
0.0
8.7
WJ.5 127.4 151.5 IU.
29.9
1U.
0.0
0.0
177.7 m.1
0.0
0.0
0.2
17.7
0.0
0O
0.0
0.6
0.0
0.0
0.0
0.0
3.4
0.0
0.0
0.0
0.0
0.0
tS.O
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.I
0.0
0.0
17.9
0.0
0.9
0.0
0.0
3.4
0.0
0.0
15.0
0.0
0.0
0.0
0.0
*.0
towerut
la Los
Usherffeip)
25.3 22.6
0.0
0.0
10.5 13L3
0.0
0.0
9.1
40.0 1Q.2
0.0
0.0
14.5 39.1
7.0
0.0
63.5
3.l
0.0
27.6
3.9
12.4
67.3
26.6
17.1 79.7 4.3
24.8 11.6 62.1 37.3
337.0 202.3
134.7 60
5.3
7.5
J0.5
2.9
3.9
21.1
2.6
3.7
19.9
Tota Mt
3.3
156.4
9.1
54.5
497.3 70.5
30.7
IL
177.3 9.4
53.4
27.3
262
70.5
2163
23.6
59.1
?7
.0
22.7
137.4 26.0
LICI OFFMIS
Capitl uitue
_leootEf ditare
tM UsasOt
lautats
47.9
0.
0.0
2.6
139.5
3.2
0.0
2.4
17.6
3.3
0.0
4.1
42.4 490
11.1
0.0
0.0
6.4
0.0
1.6
0.0
0.0
0.0
0.0
34.1
0.0
0.0
1.7
otIer
bIrl
0.7
(9.21
0.0
2.3
0.0
14.5
0.0
11.1
0.0
0.0
(27.6)1 52.1
0.0
4.0
0.0
(60.1t
0.0
(5.U
49.3
477.3
52.1
40.6
13.0
227.0
116.21 9.0
66.4 16.2
25.4
101.6
14.1)
37.5
117.91 63.6
69.6 tL3
tal Grets
tle FOds
Capital omp
_
ta
Ue
lt Cas Ptsitim
ACnl ah Psitiom
42.O
21.5
63.7
_
_
17.4
13.9
32
910.9 57.3
417.6 216.2 295.4 219.3
42.7 295.7 1067
99.4 197.0 9.0
0.0
0.
0.0
0.0
0.0
0.0
33.6 33.6 33.6 33.6 34.0
3
3
2.8
2.5
2.3
2.1
t.9
0.0
11.1
0.0
20.1
0.0
42.1
0.0
1L3
92.5
0.0
35.4
3.4
17.3
L.O
38.0
L37
0.0
5.4
0.0
(0.9)
.
.:
1
----
-
_-
40.0
443.4 261
941.9 54U
374.1
43.5
39.0 (31.01 24.3
172.3 141.3 165.5 209.0
162.0 136
54.2
2632
6.9
3321
120.1
91.1
4232
°
ULUU
MLMam
TRME
CORMPTIN
ktul madForeist lucsu andEuditur
F.Y.adiug Joe 30
1995
19
t
19U
1t0di
197
State"ts
1990 im
I990
1991
1 iWuad.I tC-d---et
1m2
(in akeKlillian)
193
1994
l
1997
1M
19W
tI
Ferry
tpas r
Freiqbt
Otw
100.1 104.2
23.6
40.6
164.4 197.7
13.7
14.1
TotalRMesem
301.8 356.9 341.7 303.9 329.8 342.5 419.9 499.1 552.0 669.6 764.2 945.4 892.9 943.6 997.8
126.4
43.1
153.2
19.0
119.9
30.t
134.2
19.1
137.8 168.3 250.4
2.6
28.6
29.9
140.1 129.9 122.5
16.1
16.6
17.1
311.0 69.4 470.8 S.6
37.0
41.
49.6 53.7
122.5 122.5 122.5 122.5
17.6
18.1
18.7
19.2
645.0
58.0
122.5
19.8
690.2
59.
122.5
20.4
738.5
61.6
122.5
21.0
70.2
43.4
122.5
21.7
EUE
Fuel& oil
103.3 146.9 119.5 101.0
Otrect
Salrries
63.5 65.1 83.9 79.3
Irthis & bintemance 25.4 29.0 21.7 35.4
Ilkwr Salaries
26.5 27.1 35.0 33.0
provision4crBad
ebt
93.8
96.3
30.7
40.2
8.6
8.2
3.0
ibaiatratim & DOarheads 42.3
8.5
9.2
3.5
55.9
52.9
4.2
fortinq Es..ou
(2.5)
15.0)
forkin Wel
34.7
42
14.7
3.8
3ruiation
31.7
35.8
41.4
40.5
3.0
6.2
7.9
17.0
iterest
t n
o
orkin batio
OpiratingIbtio
8.4
8.7
8.9
9.2
9.5
9.7
66.9
70.2
73.9
77.4
81.3
95.4
10.0 10.3
10.6
B9.7
9".9
94.1
11.0
t
10.B
269.6 319.8 332.0 310.1 334.4 351.0 367A. 368.7 375.3 394.5 412.3 441.0 474.7 510.6 549.5
Lesuir*ating SsdWy
rtinu Nirgin
104.1 115.3 109.1 103.4 1O7.2 111.2 115.6 121.1 127.0 133.2
102.3
6.B 92.4 9B.9 86.3 84.7 93.2 102.5 112.1 124.0
28.3 31.7 34.9 41.8 50.2 55.2
60.1 66.6 73.5 80.9
41.0 45.1
.6
54.6 60.0 66.0 72.6 n.9
87.9 %.
(4.9) (0.8)
0.9
1.0
0.9
1.0
(5.01 (10.0) l10.0)(10.0) (10.0)(10.0) I10.0) (10.0) 110.0) (10.0) (10.01(10.0) (10.01
5.4
1.5
62.0
129.4
47.7
196.6 20.1
362.0 413.6 429.2 4.1
458.3
78.2
92.2
117.5 137.5 150.1
13.1
(26.7)(36.7) 133.91(31.9) 14.3
51.2
104.4 189.7 244.5 276.1 m.
18.2
18.3
39.3
19.2
(44.91 (O5.0) (31)
1.0
1.1
1.0
1.0
1.1 * 1.1
33.4
95.4
36.9
73.4
00.6
97.9
106.6
(69.)
59.1
(29.3)
6.5
3.1
9.9
IL9
1.0
1.1
0.9
1.0
0.0
0.9
0.7
0.8
0.6
0.7
0.5
0.7
0.5
0.7
234.6 262.2
265.3
19.3
284.0 M.1
' .4
265.2
12.2
if.4
29.9
0.5
0.7
0.5
0.7
0.6
7
3
'0
Ph
_E
Su
hwU cwnmT
ad fott
hblaw Ssts
lam
kt
lout dimo30
1930 0965 1934 tW
117
a Fid bontb
keraies
hkt hats
11t".1
lE
1"9
9
59
Im2
191
htusto
332L5 UNA
1304 637 17.7 1M15.0192 193
276.8 312.6 354*0 345
433.8 447.2 14. 593.1
632.3 1012.9 100.
93
1442.9 1427.1 1407.2 1393.2
48.4 12.46 4.4 12.
11.1 14.4 21.4 34.
7.4
9.9 IL
15.5 17.2 17.2 16Lt 2W.I
1I6t8L
I.LI
kcmts hcaoal.
ms Iavmtrilg
?rupa7 i 1mas
143.9 155.7 152.7 163.4
210.9 212.6 211.3 M94.4
12.4 17.6 17.3 U.2
0.0
0.0 12.4 11.0
47
62.4 66.4 74.2
is fru
ok
ot lthar*w*
cad
bst
Ttal ort
133
6o
I
1uw
barvgo
Xm_lsd
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393
39.3
9.4
10.6
4
197
£99"4M9
96
2123.7 27.3 32230 34464 337.2 4.4 4130.3
675S3 77J.7 O6.2 1025l7 3176.5 1334.7 3497.
t44L4 I36.4 23.3 2422. 2710 29.7 26325
115.2 411.6 3P.6 244.7 132.3 3I
49.5
22.9 25.2 27.7 30.5 33.
3.9
40.6
249.4
1746. 161.9 146
354.1 176.9 220.3 257.9 212.4 2%.6 305.9
95". 13.7 101.46 10.
107.8 111.1 1144 111.3 121.4 125.0
0.2
4
3.5 6.?
L8
9.1
9.2
9.4
9.6
9.
7.5
69.4 33.3 172.3 141.3 1455 2090 263.2 332.1 423.2
460.1 505.4 541.9 54.6
548.5 5115. 433.0 637.6 4.0
412.3
412.3
412.3
4t2.3
432.3
0.0
0.0
0.0
0.0
0.0
0.0
32SW 335
353.2
(M70 (104.9) 11423
745.2
4.9
12.134
231
743.t
4.4
653
94.
ity & kmris
464.4
Usiltia
Vow
IUBI
latat
a Law
I -m 1tfaihh
of L-T Mt
wreFtrtU
1n3L
1994 ."95
197.9 241.7 210.0 195.2 193.2 210.9 191.1 211.4 223.2 23L.
51.7
3fticit
Aa
Uu ilItin
td ota
1993
1459.41447.5 34649. 14.5 237.4 2757.129nu.0 2611.1 2 14.6 2742.5
233.0
295S
(15.41
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Fw p
U1
6rwtIrg-m
Wm
40.9
1024.9 1010.4 1471.2
9m
69.3 "L.
Y01.9
13113.3
13W9.0 3.6 1465.0 1515. 2013.1 2029.2 2014,0 2054.9 2219.5 3011.1 345.1 3719.9 W3.3 310.4 36.6
rh
zbmt
u
105.3
(is bh illial
t Udliti
IM
UmINU
40.9
032
139
427.6
37.
40.5
0.0
2.9
2453 335.
40.5 40.5
0.
0.0
L2 t 2.9
333.
46.1
0.0
2.
44.9
44.7
136.7 Tn.
9
W.
16.4 12M.
94.4 37?
0.0
0.0
22.5
0.#
22N.5
2W.0
im. 10
11.6
60.4
3.? 1.S
62.2
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0.0
26
2435
345.
0.0
627.6
442.6
2.6
642.3
42.3
42.6
0.0
0.0
0.0
0.0
0.0
0.0
749
74.9
743.9 743.9 7.
743
1370.7) (344.21 1341.1) 4351.21 1W.3) I325.1
1030.3 101.0
307.5 1.
16
1.6
322L2 423.5 40.5
0.0
0.0
0.0
26.2 20.2
9.3
59.5
2.6
1007.5 1.A
I.5
1049.
111.4
642.6
0.0
743.9 743.9
1365.71 (257
101.0
1"1.0
3.3
3331.6 39.7 422.3 432. 4.5
465.9 3W.3
513.4 4A6. 1225.6 1544.I 1731.5 5755.1 173.t 170.5
32.4 37.2 16.9 210. 2432 25LS 253. 2t1.,
9
t
2.9
2.9
2.9
2.L
2.
4.6
16065 17M.3 21622 2414. 20.1
225
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14.4
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.
0.0
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33.1
3L3
33.
S.
33.4
33,
34.0
59.9
77.5
2
432
45
49.9
5L7
57.7
U.
T
lt.t
n.ot
374.2
175.9
139.
235.
I.A
629
330.2
297.9
55
30.3
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9.2
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0.0 L0
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0.0
0..
109. 319.9 531.9 145.1 15.
259
213.4
219.2
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0.0
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*.7
33L35.
-115Annex 16
Page 1 of 16
BARGLADESU
THIRD INLAND WATER TRANSPORTPROJCCT
SconomicEvaluation
1.
The economic evaluationpresentedhere covers the major componentsof
the project for which the benefitsare quantifiable. They compriseinvestments
in navigationalimprovements,dredging improvementsand rural launch pontoons,
i.e., approximatelyUS$38 million (includingprice and physical contingencies)
out of total projectcosts of US$54 million. Major componentsfor which economic
evaluation is not carried out are: telecommunicationsimprovements (US$1.4
million);electronicpositionfixingsystem (US$4.1million); rehabilitationand
miscellaneousequipmentfor BIWTC vessels (US$7.7million);technicalassistance
and equipment for the Inland Deck Personnel Training Centre (US$4.1million);
establishmentfor facilitiesof countryboat ownersassociation(US$1.5million);
and some of the technicalassistancecomponents(totallingUS$4.1 million) for
programmanagement,environmental
controls,safetyadministration,
andmanagement
assistancefor BIVTC.
A.
ITH Passenger
and Freight
Traffic
2.
IWT traffic
flows tend to be concentrated
in the southwestern and
northeasternparts of Bangladeshwhere the availabilityof land transportmodes
tend to be more difficult. Estimates of the present volumes of road, rail and
IWT traffic over the main transportnetwork are shown in the map attached (IBRD
Map No. 22359). These flows are estimated using the Bangladesh Transport
Modelling System (BTMS) which has been calibratedusing recent data for modal
split. Future traffic on the network has been projected using variouaE-roWth
rates based on historicalexperienceand anticipateddevelopmentalong specific
routes. In general,freightvolumes are expectedto grow at 3 percent per annum,
while passengertraffic is expectedto grow at 4 percentper annum. However,on
specificroutes,where davelopmentpotentialis high, the growth rates have been
increased to 5 percent per annum; these routes are Dhik, to Chattak in the
northeast,and Chittagongto Cox's Bazaar in the southeast. The Dbaka to Chattak
route serves an area which is not well connected to Dhaka by road and rail
transport, and is also the -outeupon which the country relies for its main
domesticsupply of stone for construction.Chittagongto Cox's Bazaar presently
has relatively little traffic and the expectation is that this part of the
country will experiencefaster growth in the future.
B. ProJect Economic Costs
3.
Financialcost estimateshave been convertedto economiccostsby shadow
pricing, and by excluding price contingencies,taxes and duties. Conversion
factorsused for shadow pricing various cost categoriesare as followis (a) for
labor, the conversionfactors used are 0.70 for unskilled labor and 0.89 for
skilled labor; (b) for diesel fuel, the conversionfactor used is 0.85; and (c)
for all other costs, the standard c6nversionfactor, estimated in other Bank
studies, of 0.80 has been used. Table 1 presents the calculationof economic
costs for each of the major componentsof the project. The followiug sections
presentthe economicevaluationsfor each of the major componentsof the project.
-116Anrex 16
Pap 2 of 16
C.
Aids to Navigation
Component
on fiveIWT routes.All
are to be implemented
improvements
Navigational
4.
of theseare eitherClassI, ClassII, or Coastalroutes(seemap IBRD 22007).
The routesares (a) Dhakato Chittagong(ClassI); (b) Dhakato Khulna (Class
I); (c) Dhakato Chattak(ClassII);(d) Dhakato Baghabari(ClassTI)sand (e)
to Cox'sBazaar(Coastal).On each route,the projectwouldupgrade
Chittagong
system to ensure full day and night navigation.
the aids-to-navigation
1,200
theseroutescomprisea totalwaterwaynetworkof upproximately
Altogether
725
approximately
on
km., and of these the projectwould improvenavigation
million
3.8
approximately
is
route-km. Totalfreighttratficon these routes
200 km. Passengertraffic
tonsper annumwith an averageleadof approximately
-erannum. Detailsof the
pass-km
2 billion
on theseroutestotalsapproximately
2.
Table
in
inputparametersfor each routeare provided
Withoutthe ProJect
Quantifiableimprovementsresulting from the aids-to-navigation
5.
in thevesselvoyagetimesthroughhigher
of the projectare reductions
component
in sailingdelaysresultingfrom
reduction
as
through
well
as
route,
speedsen
for each routeand sailing
times
voyage
Average
on
pilots.
a lower reliance
delayshave been estimatedand are presentedin Table2;
With the Project
Basedon the increasedspeedsen route,reductionsin the voyagetime
6.
of 10 percenton most routesto 33
are estimatedand theserangefromreductions
percentfor routeswhichnow have littlenightnavigationcapability.Sailing
from
to be reduced(Dhaka-Chattak)
is assumed.
delaysdue to pilotavailability
estimates,
around6 hourson averageto around5 hours. Theseare conservative
of availabledata, and in fact it is expectedthat
due to the unreliability
voyage timeswill in generalimprovemuch more than suggestedby the above
numbers.
EconomLcEvaluation and Risks
are presentedin
improvements
fromthe navigational
Benefitsresulting
7.
Table 3. These benefitsstem entirelyfrom vessel operatingcost savings
resultingfrom reductionsin the voyagedays on each route. The savingsare
costsper day on eachroute,and thesedepend
basedon averagevesseloperating
or cargo)and the averagevessel size. The
on the type of vessel (passenger
vesseloperatingcostsrangefrom Taka 3,000per day for the smallerpassenger
to Taka 5,000 per day fvr the largercargo
vesselscarrying150 passengers,
vesselscarrying750 tonson the ClassI routes.Y
overa 3-yearperiodwith
It is assumedthatthe projectis implemented
8.
benefitson two routesbeginningin the secondyear,on anothertwo routesin the
costsper annum
thirdyearand on the lastroutein the fourthyear. Maintenance
Rate of
Economic
The
costs.
investment
the
of
are assumedto be 12 percent
value
present
a
net
with
percent,
31.7
Return (ERR)is estimatedto be around
I/ Adapted from data in the Inland Water TransportMaster Plan, D9V
November1988.
Consultants,
-117Anne 18
Page 3 of 16
(NPV)at a 12 percent discountrateof Taka 315 million. Sensitivity
analyses
carried out with a 15 percent increase in cost, a 15 percentreductionin
benefits and a one year delayin benefitscombinedre3ultedin an ER of 16.5
percent and a NPV of Taka 88.7 milWon.
Details of the evaluationscarried out
are presentedin Table4.
D. Dre4dinsWorksand Uquip ent
9.
The dredging component of the project includes both equipment to improve
the efficiencyof dredgingas well as dredgingof criticalwaterwayroutesto
improvethe leastavailable
depth(LAD).Dredgingequipmentto be procuredunder
the projectincludedredgetenders,
derricks,
surveyworkboats
withaccommodation
barges,dredge instrumentation
and other miscellaneous
equipmentto improve
dredgingefficiency.Dredgingworks includedevelopment
dredgingof about 5
millioncubicmetersto improveLAD on threespecificwaterwayst the MeghnaKushiyara;
the Titas;and the Kangsa. In addition,about5 millioncubicmeters
of maintenance dredgingwouldbe carriedout to improve access to critical
inland
terminals and facilities
suchas Baghabari
Port,the Aricha-Nagarbari-Daulatdia
Ferry terminals and Barisal Port.
Without the Project
10.
Presently,
BIWTA dredgingoperationsare inefficient
and cost
approximately
Taka 34 per cubic meter. The inefficiencies
result from low
utilization
of capitalassets (dredgesoperatedon two shiftbasis),lack of
adequate equipmentforpipehandling,
surveyrandothersupporting
functions,
and
inadequate monitoring of fuel use. Along the rivers which are planned to be
improvednavigationally,
the LAD is presently0.9 m whichpreventsvesselsfrom
operatingin a fullyloadedcondition.
With the ProJect
11.
Dredgingcostsin constant1990Taka are expected to reduce from
Taka 34 per cubicmeterto aroundTaka25 per cubicmeter. The computation
of
thesecostreductions,
and theirconversion
to economiccosts,is shownin Table
5. The tableshowsalso the breakdownof dredgingcostsbetweenvariouscost
categories.Computation
of transport
cost savingsdue to increasein the LAD on
the threeroutesforwhichdevelopment
dredgingis proposedis shownin Table6.
The savingsstemfrommoreefficient
use of vesselson theseroutes,whichresult
in reductions
in the averagecostsper ton-kmor passenger-km.In improving
LAD
from0.9 m to 1.8 m, the transport
costsfor freightare estimatedto reducefrom
Taka 1.39 per ton-km to Taka 0.90 per ton-kmYV Similarly,the cost of
passengertransportalso reducesfrom Taka 0.32 per pass-kmto Taka 0.27 per
pass-km. All of thesetransportcostsare estimatedin economiccost termsin
constant1990Taka.
Evaluation of lenefits
and Risks
2/
Cost reductions in freight are primarily from substantial
scale economics vf
vesselsof 500 tonscapacitycomparedwita vesselsof 200 tons. Passenger
savingsresultfromsomewhatlargerveseel-and reductions
in diversions
due
to shallowchannels.
-118Amnex 18
PFae 4 of 16
12.
The dredgingworks are a& uned to be completedover a four-year
period, and benefits begin to accrue from the second year.
Operational
improvementsand dredge fleet rehabilitationis assumed to take place over a
four-year period, however, the benefits from some of these improvementsare
availableIn the second year. Table 7 presentsthe computationof the benefits.
13.
Benefitsfrom reductionin the cost of dredging is consideredto
apply to both the maintenance dredgingworks of 5 million cubic mieters(which
would be umdertakeneven without the project) and to the developmentdredging.
The latter is based on the fact that the developmentdredging is economically
justifiedat the higher cost of dredging (withoutimprovements). These dredging
cost improvementsare also applied to future levels of capital dredgingsince it
is expected that once these improvements have been achieved they will be
sustained in the future.
14.
Rates of return and present value computationsare presented in
Table 8. It is noted that the ERR for Dredge OperationsImprovementsis low (7.6
percent),whereas the ERR for dredgingworks is high (ERR 53 percent), and the
combinedERR for the dredgingcomponentis an acceptable23 percent. The NPV for
the dredging component is estimated at Taka 279 million.
The ERR with a combined
one year delay in benefits, 15 percent
reduction
in benefits
and 15 percent
increase
in cost is 12.5 percent and the NPV reducesto Taka 12.3 million.
The
low ERR for the Dredge Operations
Improvement component *5 due to its including
substantial
amounts for hydrographic
survey and for training
and technical
assistance. The hydrographicsurvey investmentswill yield additionalbenefits,
outside of dredging,owing to this activitybeing a support functionaffecting
all waterway uses.
The technical assistance also will yield additional
(unquantifiable)
benefits,because improvementsin dredgingmethods are expected
to eventuallyinfluenceall dredging in Bangladesh,of which BIWTA dredging is
only a smallportion (Bangladesh
Water DevelopmentBoard and the Port Authorities
also carry out dredging, and account for 60 percent of total dredge volukes),
B.
Rural Launch Pontoons
15.
This component includes constructionand installationof 100 nos.
steel
pontoons
to be located primarily in the North-East
and South-West of
Bangladesh. The geographicaldispositionof these pontoonsare shown in the map
attached (IBRDMap 22007). Each of the locationsis presently a landing stage
for motor launches and,country boats transportingpassengersand cargo in the
rural areas. On average,these landingstageshandle about 40,000passengters
and
about 13,000 tons of cargo per annum. In siting launch pontoons,the S.overnment
will select sites that meet the agreed criteria (Annex 3).
Without
the ProJect
16.
Presently,launch landingsnot providedwith pontoon facilities
are accessed with considerable difficulty. This results,in delays to the
vessels, passengersand cargo, and also results in a higher handling cost and
damage to cargo.
It is estimated
that a launch discharging
and embarking
passengerswithout use of a pontoon incursa delay of about 20 minutes on Average
due to the need to use small country boats to ferry passengers to the shore.
Cargo discharge on bare slopes results in damage of about 5 percent based on
recent estimates.'Cargo handling costs on bare slopes is estimated at Taka 20
-119Page 5 of 16
per ton.
With the Proiect
17.
Provision
of pontoonsis likelyto resultin a reduction
in launch
berthingtimeson averagefrom20 minutesto 10 minutes,cargohandlingcostfrom
Taka 20/tonto Taka lS/ton,and cargo damagefrom 5 percenton averageto 4
percent. Thiswill resultin substantial
savingsin vesseltime,passengertime
and cargo losses.
DconomicEvaluationand Risks
18.
Benefitsfromreductions
in vesselberthingtimeare evaluated
as
the sum of vesseltimesavingsand passengertimesavings.Vesseltime savings
are basedon an averagevalueof vesseltimeestimatedto be Taka 3,000per day.
Passengertimesavingsare basedon an averageloadfactorof 50 percent(i.e.,
the launchis assumedon averageto be half full),and averagelaunchcapaAity
and a value of passengertime of Taka 7 per hour. Cargo
of 100 passengers,
damagesavingsare estimatedbasedon an averagevalueof Taka4,500per ton of
cargo. The lastis an extremely
lowvalue,and thisreflectsthe likelihood
that
more care is takenin handlinghighervaluecargoand thereforethe lossesare
most likely concentratedin lower value bulk couvsodities.Detailsof the
analysiscarriedout is presentedin Table9.
19.
Benefitsare assumed to accrue in line with the pontoon
deploymentscheduleshownin Table 9. Maintenance
costsare assumedto be 5
percentof the investment
cost,however,it is expectedthata majormaintenance
expenditure
willneedto be incurredin year1S, and thiswillentailexpenditure
of 15 percentof initialinvestment.The ERR overa 20-yearhorizonis estimated
at 26 percent,with an NPV (at a 12 percentdiscountrate)of Taka 311 million
on an initialinvestment
of aboutTaka360million.Sensitivity
analysescarried
out indicatethatwith a combinedone yeardelayin benefits,15 percentincrease
in costsand a 15 percentreductionin benefits,the ERR drops to 15.1 percent
and the NPV dropsto Taka 78.9million. Detailsare providedin Table10.
F. OverallProlectEvaluation
20.
For theabovethreemajorcomponents,
combinedratesof returnand
presentvaluecomputations
were carriedout. The base case ERR for the three
projectcomponents
combinedis estimated
to be 26 5 percent,
with an NPV of Taka
853 million. Sensitivity
analysiscarriedout indicatedan ERR of 14.6percent
with a combinedone yeardelayin benefits,15 percentincreasein costsand 15
percentreductionin benefits.In addition,the rateof returnfor the overall
projectwas computedincludingin the costsof all of the technicalassistance
and othercomponents
for whichbenefitshave not been quantified.The results
of the economicevaluation
are summarized
belowand detailsare in Table11.
-120-
Annex 18
Page 6 of 16
Table 1
SANOLGDLAIIH
ThirJiInlatd
Water TrerOt
Lconmic Project
Proe"t
Cene
CrokeNi 11lefn.)
Project
CompOnents
_.___..........._..____................... -
-_ -_ -
-----____
Lcal
._
Financial Coste
Foreign
ToUl
__..._
_
..
CQnver*lont
Factor
LcAl
5..nein
Coo"
Foreign
Totel
_.__
(a) Aide - To - Navlgation
INvalds A Aeceorwle
Laonr
Tranaort
Total
U.44
17.15
17. 1
114.80
19.68
4.71
180.16
40.01
62.67
7.16
162.
36.04
0.80
0.T0
0.64
$1.09
12.01
10.96
114.80
22.8
45.72
145.89
8.47
8670
84.OT
182.6
16.95
350.00
290.00
(b) Oredtlgn
Dredge Gupor
Equip.
Labor
Fue
TeOtI
10.00
:0.00
90.00
10.00
50.00
00.00
0.60
40.00
40.00
60.00
0.6
17.60
40.00
87.60
0.00
90.00
0."
76.80
0.00
76.80
390.00
410.00
284.80
390.00
44.30
(e) Rural Poentooe
Pontoosa& Ftel itieas
70.00
110.00
160.00
0.60
86.
To" & tleetln
Labor
Fuel
10.00
20.00
10.00
90.40
90.00
0.00
100.00
40.00
10.00
0.60
0.70
o."
6.00
14.00
35.10
9.00
30.00
0.00
380.00
350.00
106.60
360.00
EqIp.
Toal
89.00
in00 1800 06.00
80.00
84.00
35.10
8.10
Annex18
ap 7 of 16
Table 2
-121SA
TIR
UIA
OL A§31H
WA75 lnWW
A14ideto Rovigate
IntutPraeter
Uhit*
1. Navigable Diltaneo
DOepth
3. RouteLength Zmprov*d
2. Leat Avallbl
0h
to
Chittgeng
Ki lomarte
Natre
xi lomtr
104.0
J.0
110.0
#Or
Ohake
to
Nlhuina
30
8.0
300.0
PoJWT
Componmnt
Ua.ieui.
Anoiyoi*
Oha"
to
Chattak
Chak*
ChIttgg
to
to
S uehbbari
CO#sRzee
84.0
1.6
5.0
147.0
1.0
80.0
76.0
8.0
78.0
0.5
10
0.6
20
4000
1
0.1
76
0.8
210
4000
M0
Total
ferAl
mau.m
7.
Frei9htSate
4.
B.
6.
7.
6.
9.
Froight Volua - I6
"III. u*tone
AverageLeadfor Freight Kilo_tro
AverageLo4 Factor
lalubr
Vasel Site (Avg.Cap)
,.
Toe
V_e.l Operating
CoOt
Take/toy
RoundTrips Pop Annum
N0akr
Pas"ger
2.1
780
a0
11J
0.0
900
0.9
70
S0
4U
7100
180
0.0
am
4000
9M
1100
900
0.6
SW
4000
114U
110
100
0.J
is0
8000
4Jim
1.47
0.9
10
1.S4
0.3
a
800
0,6
0.8
M00
0.
20
4000
1s06 T
.8.
Om
Date
10.Psentgr Traffic- I9JS
11.AverageRouteLength
12.AverageLoadFactor
18. Veael is (Avg. Cap)
14. Vessel Operating Coat.
18. RoundTrips Per Annum
F4i1Pa-ke
Kiler
nee
Number
Pas.
Take/toy
*W*er
0
0
0
0
0
0
10
To
0.O
So0
JOtO
411
Without the Project
16. VoyageTie.
17.SailIng Delay due to Pilot
1. Avg.Speedon Routo
Oays
Coy,
Kh
0.04
0.M
iS
0.62
0.5
10
0.81
0.8
1i
1200
3117
A
8IofS1
Pa.of 16
Tt le 3
-122-
projei
Votier Trgmpl
blfed
Third
A1id to bvlgwbtien
C_e*en.,
Ua-fit
volts
I, Shake - Chittaongo Rout.,
2. Olshh- WhulnaRout.
S. Shoke - Chaotte Rou"
196
1l9
199
1t"
.w4
I9s6 2000
t0o
88.15
Mill. Take
Yake
"il.
T
"ll.
71.00
W.78
17.75
MIII. T eo
4. Choke * Sagh1eri Route
0.00
MIII . Yake
8. Ctg. - Cox* aser Route
TRAFFIC PROJETION1
Ohoke - Chittegon oRout.
1.81
2.81
2.44
2.#0
2.80
Mill. Tone 2.10
S. Freight Volume
6
2m67 g7
26
93
9565
Tri# *.s.
T. Roui Trioe - Cergo V..
92
no
3
619
76
700
witl. Pes"m
S. Peeeenger Traffl
129
106
118
10966 I1187
92
Trip. p.*.
10. Romud Trips - Peso Ve..
Rout.
Dheaka - (hlu,
0.74
0.72
0.7o
0.66
0."
Toem 0.60
pill.
11. Frflght Volume
54
1
US
80
46
444
Trips P.*.
12. Round Trioe - Cerg Ve..
1446
192
1297 183
13
1100
Fitl. Pesok
l
Trffi
1S. Pioueg.r
1400t U186
89
12910 1S4
1146
Trip* p.*.
14. Roui Trits - Pas. V .
Cokse - Chattk Rot.
0.70
0.67
o.64
0.61
0.80
0.80
14II. tone
15. Freight Volum
060
199
19S
167
16
1667
p.c.
'trip
16. Roud Trips - Cargo Ves.
110 17.84 188.70 140.89 147.41 114.76
"ill. Pass-k
17. P_senerr Traffic
6
uo
87
8186 8S6
486
Tripe p..
16. Round Trips - P.... Vee.
toeriRout.
Choe - S
0.62
0.60
0.Sl
0.86
0.86
0.8
MIII. YeTo
19. Freight Volum
g0m
199
196
187
1
1667
Trips P.a.
go. Roun Trips - Corp VYe.
0
0
0
0
0
0
Ml. PFee
21. Passen_er ytffe
0
0 °0
0
0
0
Trripep..
22.Ron, Trip* - Pe. V*.
c- . - Come lesseor Roiu
0.18 0.14
0.12 0.1I
0.12
0.10
itilI.Tom
95. ireight Volum
806
99
290
21
278
280
Tripe p.o.
24. ond Tripe - Crgo Vee.
12.1 .76 13.40 14.07
10 111.81
Nil. Po-k.
25. Pessengr Traffic
41
S0
800
461
46
411
Tripe, ..
26. Round Tripe - Pass. Veo.
VU6.
t0o
2.99
87
11
18572
8.47
6
1"
18
Avg. S ,...
4.1
4"so
180 Avg. 4f *.a.
90
1.18
O."
0.66
651
784
04
M0
14
16
21
16316 _
Route
lOulne Route
Chottek Route
noute
sghseerl
MIll.I Yaks
"MIl. Take
TYk
mill.
"illI. Yaks
t.
Omer
S1. Cto. - Cooes,
with the Project:
ROu"
S2. Shoke- Chi ttgog
n
aS. woke -l(u"mine
ut
84. Ohsks - Che ttR
"ill.tk
ri Rout
So. Shake - illob
. Ctg. -CooebaserRote
Ta
tkeu
Hill
MiII.Take
87. Chke - Chittsgon RO
#i. OSako - lwing Roeu.
8o. ohms - Chottek Rout.
40. Shake - lehah ei route
Hill-.
M60 Tk*
IIill. Tul
aks
Iill.
41. Cog. - Cooe Omear
ute
oill. Tk
NillN. t1 e
l II. Iake
HIllt.Yaks
TYk
Mill.
III
1
as
14
S
12
M8
95
1119
16
4
1i
4
19t
9O
1"0
110
171
122
17
147
216
72
14
8
75
14
S
69
17
4
17
26
107
19
8
19.0
19.7
65.0
0.4
87.2
84.8
21.2
66.7
66.6
8.1
0.6
8.2
0.0
8.8
0.9
0.6
Age. 4
P.*.
Grth
Ave.
2t
7
a
Grow0
0.2
479
418
1T796 9591 4U115
97
601
65
24
18
*.S.
0.28
-1
29
8
1US
t
a
0.18
4
4
46 p.s. Growth
0
0
91
M
190
4
A".
A.
20
81
1U8
148
216
110
is
U p.S. Growt
0".9
81
0
0
178
2S
15
18
132
2
U0
102 lOi
17
17
Avg.
0.65
v"4
0
0
0.71
Pro)ect:
ahttegeng
0mu*
1.40 Avg. W p.s. Growt
1.18
0.90
191
2784
7
Avg. J4 p.. arent
3,97.0 111.01 81.6
163
94
7J41
SPWATIM COSNS
th
withot
27. hi*ke 95. Ch-ek 29. Che. 8o. Shake -
rout
6
214
819
8
129
S
8
95.8
47.0
42.7
SO.
87.1
61.2
87.1
n1.4
61.5
8.5
1.0
4.4
1.2
5.1
1.8
.p.eGroth
AVO- UPs.
Growth
BANGLADESH
IM
NDM WAOTRANII
tR
Aide to Navigation
(Take
:Y E AR:DHAK - CRTTAaON:
: :Cost&
Bf
i to:
PROJEB
Cezaomt
Hi I I ;o)
DHAK - KHULW: DHAK - CHMATK : 1O
Cost*
IbnefI to:
Co"
Beuwf;ts:
Cas
- 9AOHAMRI :CM. - COf( 8^ZAAiR:OVERLL
Inift
: Cost&
llfite
Mt Flo:
:
: gl:
l
S3.S
: 1C2
6.4
19.0 :
: n3
:994:
: 195
IVA96
:1997:
:1@98
IM"4
6.4
6.4
6.4
19.7 :
20.4 :
21.2 :
6.4
6.4
8.4
6.4
: 2000:
: 2001
:
8.5
8.5
8.6
3.S
37.2:
S8.7:
868
8.8
10.7
10.7
:
34.S :
S5.6 :
.
2.1
2.1
.1:
3.2:
S.S:
6.0
O.?
0.r.8
0.7
0.7
22.1 :
8.5
40.4:
10.7
37.0 :
2.1
3.4:
22.9 :
2S.8 :
24.7 :
8.S
8.5
8.5
10.7
10.7
10.7
38.4 :
S9.90:
41.3S:
2.1
2.1
2.1
3.S :
3.6 :
3.7 :
6.4
8.4
25.S :
26.6 :
8.S
8.15
42.0:
43.7
45.4:
4n.0
10.7
10.7
42.7?:
44.4 :
2.1
2.1
10.7
46.1
:
47.8 :
17.8
0.8:
-76.1:
0.8:
0.0:
-47.1:
S7.6:
71.2:
0.7
0.0:
75.3:
0.7
0.7
0.7
0.0:
1.0:
1.0:
S.8 :
3.90:
0.7
0.?
1.0:
1.1:
2.1
4.0
:
0.7
1.1 :
79.4:
63.5:
87.6 :
91.7t:
"6..:
lOl.S:
2.1
4.2 c
0.7
1.1 :
1C6.4:
:
:
2.1
2.1
4.8:
4.4:
0.?
0.7
1.2 :
1.2 :
1.3 :
1.3S:
1.4 :
1.4:.
1.6:
111.4
11 ,S:
n.0
49.0:
110S2:
6.4
27.6
:
8.S
: 2D03:
6.4
28.7?:
8.S
6S.1
:10.7
:
:
2D4:
2005
6.4
6.4
8.S
8.S
SS.1
S7.1
:10.7
:10.7
2006
6.4
S2.0:
8.5
sq.6
10.7
ES.3S:
2.1
4.S:
0.7
:2007:
: 2009
:w2W:
:2010 :
6.4
6.4
6.4
6.4
38.S:
34.6:
SS.8:
87.1
8.S
8.S
8.5
8.5
62.0
64.S:
46.9:
69.4:
:10.7
10.7
10.7
10.7
35.8 :
S7.4 :
S9.4 :
61.S :
2.1
2.1
2.1
2.1
4.7:
4.8 :
4.0 :
5.1 :
0.7
0.7
0.7
0.7
:
29.7
S0.8:
:
Sl.0:
49.S
S1.2
:
:-59.3:
NPV (O 12 b:
122.2:
2.2:
134.1:
140.1:
146.0:
314.0:
SE NS IT IV IT Y:
+1 5
-1 S
C06mo
CO
sofi It
l Yr St ;w:
41.1
-S9.S
-11.1 :
-IO.S
-79.I
-110.2 :
-6S.1
6.
-15
63.3
53.2
17.8 :
67.0
56.S
48.0:
7.1
9.8
S2.0 :1
7S.1
63.2
5.5:5 :
79.2
66.7
S0.0 :
83.3
70.2
62.4:
87.4
7n.6
85.9:
92.S
7n.s
$9.4:
97.2
02.0
73.6:
102.2
#
.2
77.8
10.1
90.4
01.9
11.0
04.61
96.1:
II$.0
W.6
90.S:
10.9
0 4.7
OS.4:
L.0 9
9.8
100.4:
136.8
114.0
106.S:
141.9
110.
110.6:
2 2.S
21S.3
n.7:
IO
oo
Annex18
-124-
Page 10 of 16
Table 5
SA*OLAO
Thirdinlan
16
hWae ?renep
Projectb
Component
Dredging
Unit Costof Dredgng
COSTS
DREDOINO
OF
ORSAKD4OWN
Avg.PerDrge
( il"ancill Cosd InTake Cu. M.)
Production
Overhd. Toheu Cost
WIge
Fbue
RepeIr
Cepliol
(Cu./Y*er)
SCENARIO
J.5
51.000
18.7
I1. ExtOndShift(80-70 hr/uk)
(X Change)
489,000
(.25)
14.9
(-205)
4.0
(.155)
III.ntroduce Fuel Mnitoring
851.000
16.7
8.8
458.000
(+301)
14.4
(-283)
(1
570.400
(.621)
11.6
(-851)
4.6
(+.81)
I.
Preent Operatlen.
(X Change)
IV. In.c Deployment (27-as k)
(1 Change)
V. AllIlprovemvntCocbined
(11Change)
0.60
(Convereion Factor)
4.1
0.7
2.0
2.0
83.7
6.7
(ON)
2.5
(*209)
2.4
(-183)
80.5
2.0
2.6
81.7
4.7
-8)
6.7
(0S)
4.7
(-801
1.7
(-18
2.2
(-211)
2.1
(+05)
1.9
(4)
29.1
15.1
( ECoonec Cost.it Take/ Cu. ".)
0.60
0.69
0.65
0.0J
851,000
15.0
2.6
5.7
1.8
2.2
27.5
439,000
11.9
8.2
5.7
2.2
1.9
25.0
III.Sntroduco Fuel NMnitoring
JSl,OQO
15.0
2.0
4.0
1.6
2.2
85.6
ZV. Inc. Deployment(27-85 wk)
456.000
J.1
11.5
.7
1.5
1.6
28.6
V. AllIprovemnoteCombined
37),400
9.8
4.0
1.9
1.5
20.5
Z. PresentOperation.
S. Extend Shift
(50-70 hr/wk)
8.6
Saving Per Cubic Meter
s
7.0
-125-
16ex1
Table 6
SAWOLADEsH
ThIrd In land V9eteTranspert Proj ect
Dredgi-to Component
Transport Coat salawn
Units
1166
1991
199
1996
1994
1998
gm0
2005
3010
I.
1.
2.
3.
4.
S.
6.
7.
6.
9.
10.
It.
KWSKIY*fARZVR
Proeghb Trafific
100 0a. Tons
PeassungerTraffic
1000 Poea.
Freight Ton-I(.
WillI. Ton-ks
Peeange,r - Ka
WIll . Pes-K.(
Freight Coat (0.9. LAO) Hill. Take
Ptpa. Coat (0.9. LAO)
Wil *1 Teks
Tot. Trp. Cost (0. 90 LAO) WIll.- Taea
Freight Cost (1.8m LAD) Wilt. Take
Pess. Coat (1.6. LAD)
Will. Take
Tot. Trp. Cost (1.6. LAD) Will. Take
Traneport Coot Sevings
Will. Take
no0
600
51.0
42.0
70.9
13.4
84.8
45.9
11.3
57.2
97.1
55
69
56.6
46.7
76.7
15.6
94.5
80.9
15.1
64.1
30.2
57
59
615
6a5
78
6n0 1000
73
76
6as
of5 1045 l8co
1600
65.7 60.7
62.7 6I4.6 75.0 66.7 102.0
51.1
85.6 66.4
59.2 78.2 91.0 128.0
81.5
64.4 67.2 90.0 104.2 190.5 141.0
16.4 17.1 16.0 15.9 23.4
29.1 85.6
97.9 101.5 1011.2 109.0 W3.6 149.6 177.6
32.6 84.6 56.5
55.8 67.5
75.0 91.0
18.6 14.5 15.2 16.0 19.6 24.6
80.2
68.6 69.
71.7
74.8 67.2 102.6 12.0
81.5 82.4
58.6 54.7 40.4 47.0
85.6
It.
1.
2.
S.
4.
S.
6.
7.
S.
9.
10.
11.
I(AMOARIM
Freight TYaffic
1000 a. Tom,
Pase.nger Traffic
1000 Pse".
Freight Ton-Km
Mill1. Too-km
Passenger - Ks
Will1. Peas-K.
Freight Cost (0.9. LAD) Will1. Teks
Pese.. Cost (0.9., LAD)
Will1. Tak.
Tot. Trp. Cost (0. 9. LAD) Will1. Taek
Pr*olght Coat (1.8. LAD) Will1. Take
Pe".. Coot (1.6. LAD)
Wll . Take
Tot. Trp. Cost (1.6.m LAD) Will . Trake
Transport Cost SavIngs
MlI I. Take
300
500
59.6
24.5
85.0
7.6
62.6
85.6
6.6
42.2
20.6
555
580
44.2
26.4
61.51
9.1
70.5
59.6
7.7
4758
93.1
845
565
45.5
29.6
65.54
9.5
72.6
41.0
6.0
49.0
251.6
IIU.T'ITAS RIM~
2.. Fr. gjht Trasfic
1000 a. Tone
2. Pe.aong.r Traffic
1000 Pee".
S. Fr. I ot Ton-Km
Will1. Ton-km
4. Poe.engr - Km
Hill. Peee-(.
S. Frolght Coat (0.9. LAD) WIll . Tkek
6. Pe".. Coat (0.9. LAD)
Mill1. Take
7. Tot, Trp. Cost (0. 9. LAD) Will1. Take
6. Freight cost (1.6. LAD) Mill. Take
9. Pee.. Coat (1.6. LAD)
Will. Take
10. Tot. Trp. Cost (1.6. LAD) WIll. Take
11. Trensport Cost Savinga
1Will. Taka
60
168
4.2
79.6
5.6
26.5
51.5
3.6
21.5
2.3.
6.0
65S
2130
4.6
91.5
6.5
29.6
85.9
4.1
25.0
29.1
6.9
70
225
4.9
"6.61
6.6
51.0
57.6
4.4
25.1
80.5
7.2
TV. OVEALLTRANSPOR
COSTSAVVNG
J,6. Coot w/o Project
Will. Take
17. Coat */ Project
WIll . Take
18. Transport Cost Seving
Wll . Take
-5
465
46.9
51.2
go.1
10.0
75.1I
42.2
6.4
80.6
24.5
870
400
46.6
52.4
67.9
10.4
76.5
44.0
6.7
62.7
25.
555
415
80.6
34.4
70.6
11.0
61.7
45.7
9.5
88.0
26.6
440
SO0
600
640M 700
560.1 66.0
79.2
42.5 51.6
85.7
60.7
91.7 110.1
15.6 I16.6 18.1
94.5 106.5 1.26.
82.5
59.4 71.5
11.5 14.0 15.5
68.6
78.4 68.6
80.6 34.9
41.6
-
75
W0
65
90
100
110
2360 246
3600 SOD0 4000 500
8.8
5.6
6.0
6.5
7.0
7.7
101.5 106.6 111.0 159.6 172.0 215.0
7.3
7.6
6.5
6.8
9.7
10.7
.59.5
'U.1I85.6
44.T 56.0
.68.
89.61 41.9 44.0 85.5
64.6 79.
4.7
5.0
8.4
8.7
6.5
6.9
27.4
26.6 30.2 87.7
46.4 85.1
55.
85.6 55.5 48.4
52.7 65.0
7.6
6.1
6.5 10.1
22.0
14.5
176.4 200.7 906.4 216.4 925.4 234.7 275.4 M2.? 165.4
124.7 140.6 146.1 151.6 285.2 164.6 19'.4 295.7 275.5
go.7
60.1 62.5
64.6 67.2 69.6 61.1
94.0 111.7
Oroh Rate: a Pe
Grow Rates 43 Pe
Avg. l.ad 1og ke.
Avg. l..d 70 km.
61Tk 1.39/ ton-km
0 7k 0.32/ gow-k.
III k 0.90/ ton-kmn
. 1k 0.27/ pos-kw
OrostA Rates 851pa
Gregot Raet: 43 Ps
Avg. lead 152 km.
Avg. lead 61 km.
61k 1.59/ ton-kw
01k 0.32/pease-k.
Th 0."0/ ton-km
61k 0.27/ pms-k.
Orowth Rate: MI P.
Crewt" Rate: 43 pa
Avg. leadi 70 km.
Avg. lead 435km.
61k 1.59/ ton-k.
6k 0.521 Pasw-ko
6Thk 0.90/.ton-kms
1k 0.27/ Paa..-,a
Ac.lxj 8
Pag 12 of 16
Table 7
-126O AN1
rDV D2L
LA
516 11
WAnE 1WW
pJ7
DrwedingGerpwmnet
un*ite
196
19
199
196
194
1
MO
000
0
310
1.0
1.0
1.0
1.0
1.0
1.0
0.30
0.13
0.17
2.:0
2.90
0.20
0.12
0.17
$.00
8.49
0.20
0.22
0.1?
8.80
8."
S."
4.49
4.99
i. Capitol rwedginga. i(uaiv.c
River
"Ill.
Co.
1.0
N.
1.0
b.KRus tivr
"III.Cu. I.
"III. Co..
c. TIltRiver
d. Ft*reC*apital
DrewdngtiUII. Co. N.
Totl CaTptal Ording
W"Ill. Co. N.
3. ml1ntene Drwein
a. Kuehl"ra River
Iill. CU. N.
b. KIb_s Rivr
1i111. Cu. 11.
c. Tlta Rivewr
WTIl.Cu. 14.
d. OtherInland1
WatrPSY WIll.
.
Co.".
Total Naintenena. Dreging "III. Cu. 11.
2.00 2.00
2.00 2.00
2.00
2.10
O.0D 0.30 0.30
0.13 0.12
0.17
2.00 2.00 2.00
2.30 2.82 2.49
8. Total Dredging 5uantites
2.00
8.10
8.40
Will. CO. N.
1.2
1.7
0.0
1.0
1.0
0.10
8.00
1.2
1.7
4.02
1.0
1.0
8.40
WIthut toe Project
4. Unit Cost ef Oreging */
S. Dredtgin BepoWiture
6. Traonert Coa 6/
27.8 27.5 27.5 2.5
110.4 ".9
109.6 33.4
U5.4 214.7 25.4
23.7
n.5
Take/Cu. 14.
W11i. Tak
NIl1. Tak*
27.5 27.5 37.5 2.5
85.0 S1.4
U.1
9.4
176.4 300.7 206.4 21.4
Tke/Cu. N.
WIill. T7..
WIl1. Take
27.5 27.5 54.0 30.5 30.5 0.. 30.5 3.5
30.5
85.0 S1.4
74.4 69.7 8.4
71.4 61.5 92.1 102.5
124.7 140.6 14t.1 151.6 15.2 164.6 194.4
S.? 2736.
MI.1
.4
With th Projet
7. Unit Codt Of DreOdg
8. Dredging bndalture
9. Transport Coete
Benef Ito
10. Oreging Cost Savins
11. Trweaprt Coat SavIng
"WIll. Take
IWill. Take
0.0
86.7
0.0
60.1
10.6
61.5
3.7
64.6
33.0
67.2
24.8
69.6
2.6
61.1
51.6
04.0
84.5
111.7
1*. Teotl
"Il.
Take
86.7
60.1
76.1
63.8
96.2
94.2 106.9
,115
146.5
a/
b/
Denefits,
For detl
Kew detail.la
e" Table 6.5
Table6.6
-127-
Annex 18
Page 13 of 16
Table 8
SANGLADISH
TInland
isWter Trgw,.ert
Dr.dIn
ProeJc
CeupwXa
CostO and4 Snef it.
CTae *n11.)
3
Dredge 0eUtionleS
Irewt
A Mydrorhlc
Surv.y Compnnt
YEA R
:COSTS
:
O
: USITS
:8F
1991 :
86.07
1m
1998
1994 :
19s
1996
19
6W.11
87.11 :
8.07
199 :
2000
wl
2002
200:
2004
206S
200aoo
2007
20o0 28.8
200:
2010
:
:
25.0 :
:
25.72 :
26.42 2
27.12 2
27.6
26.51
29.21 2
29.91
80.0o :
31.60:
62.00 :
63.69t
:
84.09
4.79 .
:
ER(S)
18S)
:
:
:
2
t
-76.31
-68.41
40.06
24.81:
2S.0:
26.72
26.42
27.12
27.61
26.81
29.21
29.91:
60.60
11.60:
82.00
82.69
81.89
84.09
84.79
:
-52.96:
:
7.M9
Kn.
WT
s
-56.07 :
:
:
7.46:
27.4:
81.97
46.n1
2
:
:
2
:
:
:
:
:
13.46
1SA.46
1.4
13.46
8.46 :
18.46 :
15.46 2
1S.46:
1.46 *
15.46 :
15.46 :
13.46 2
15.46 2
18.46
16.46:
PL
UKt
:
15.6
382.42
59.11
".9.012
72.07 .
74.82 2
76.56
76.61
61.06 :
63.64 2
*6.23
66.62:
91.41
O6.9
97.5J
101.10
104.65
10 .20:
111.7n
OVUL.L
:
tE
4
tS.4*
2
KublI7rU,
and Tits
RIv.r.
Capitol Drdit
IOSS
mu KM:
:
::
NPV(6
: tET PL
10.61:
23.70:
26.02
24.13:
1998
t
:
sef
-27.46:
-11.68
-0.55
12.40
91.86:
5.61
60.6
6.10
M
65.84,
7.59
70.1
72.77
2
2
2
rK
:
2
t
2
*
:
77.94:
60.61
4.06
67.68 .
91.16 2
94.78
90.2:
.
279.64 s
:
2.95:
+1*
5
:
N*CoSTS UWTS
t
-6.18
-"..9
-17.65:
60.69:
68.6
6.5
9.52 t
92.46 t
95.40 :
6.69*
101.96 :
105.186
t.5:
1*
111.56 :
116.06 :
110.8 2
124.7 t
1.16.62 *
18a.07
26.66
22.69:
ITY
SeNSITIV
15-1S
3
2
C
Ca
-96s.4
-5.5
2
75.86:
.
tE : 1.9
:
-106.8
42.0
-81.4
76.7
61.6
4.
67.
90.4
.4
96.7
tO1.O
10.2
to10.$
80.2
t
4D AND
1YerUP Sl P
ly
-5.s
-".4
-42.1
-72.4
-M11.
-115.6
40.7
*72.0
6.
"9.1
71.6
74.1
76.6
7.1
61.9
4.7
67.5
109.6
114.1
118.3
12.
126.6
181.0
98.0
96.6
100.8
108.9
17.5.$ *
11.1
169.9
19.2
185.0
1t.7
56.6
64.5
67.0
69.
72.1
74.6
77.1
79.6
62.6
65.4
.
*1.2
91.0
94.6
98.2
01.
16.5
12.2
11.5
Annex 18
-128-
Page 14 of 16
Table 9
SANG LADUSM
In)awd Water TransportProject
Third
Rural
LsndInq Ponteoos
aumtmh
Iont
Units
Naber
Schad.
Pontoon PVocureint
Number
Ponto". operating
2. Add)I.
1000a. Tons
3. Freight Traffic p.a.
1
4.
Psoaonger Traffic
g.e.
p.*.
of Sertlings
S. P*uober
withuit
lw
P....
Thous.
1991
192
198I
20
so
so
10
80
so
no0
420
84
160
216
I to
1994
20
s0
910
2W0
376
2006
2010
199S
2X0
so
1M0
1866 1935 261
4200
3124
840
69
621
60
762
Avg.100t/eontoon p.0
Avg. 42000
aspontoon
961 Avg. 16 .ti8/a/OtW
p/
the Project
1000V*as-day
6. VeasolTimeat iadIng
7. PassengerTi.. ait Landing Mi l. Per*-"re
MIII. Take
S. Ves"l Time Coat
NIII.Tel.s
Tim.Cost
9. Passen.ger
"III.Taek
Coot
Nondli!ng
10.FroeIght
MiII.Take
11.TotelCootto Uaera
2.97 8.20 7.48 9.06 11.06 13.40 Avg.20 mine/SVrthig
0.74
0.69 8.16 6.24 6.91 10.67 18.29 13.16 Avg.Cap 100 pope.Ld Pat 0.8
23.26 2.16 83.1 40.48 Val of V."*. Time 8000 tk/dy
5S.89
1
2.286.91
6.24 24.95 48.66 62.37 76.09 92.68113.25Val of Ptee.Time7 tk/Nour,
DONOVAN.
tk/ton,
474.06876.85 Plan4linot20
8116.80868.57
81.68127.O0222.95
40.81 161.26 262.20 406.18 491.84 800.04 78205
With the Project
12. V.sael Time at LandIng" 1000 Vese-deys
Poet-Mrs
Tim.at Landi"sNgIll.
13. Passenger
MIII. lake
14. Vessel Ti..Cost
Teke
"Ill.
18. Passenger Ti.. Coot
Take
Mill1.
Coat
16.Fr.IghtHandl4Ingq
NMI1. Take
17. TOteI Cost to Users
2.66 3.68 4.67 8.99 6.98 Avg. 10 aInsl 6.rthl.Ig
0.86 1.8
Avg Cop 100 peso.Ud Fat 0.5
0.46 1.64 8.21 4.59 5.60 6.68 6.8311
1.18 4.39 6.06 11.46 14.00 17.06 20.64 Va) of VOeS.TrI. 800 tk/daY
9k/Hour
8.21 12.68 22.49 82.18 39.20 47.62 86.84 Vel of Pee.. TI..
309.27377.31460.82 Hasdllng:15 tk/ton,Domge:sA
26.88102.40177.4821581.50
889.80
442.21
29.71 118.642907.97297.118362.47
Senef I t
1i.
19.
20.
21.
Vessel cost fewing*
Pase"nger TI.. Savings
Freight HNmdlingSavings
Totel UAserCost Savings
MIll.
Taoe
MillI . Take
Take
"ill.
NMII. Take
1.06 4.82 7.6" 10.60 18.16
8.02 12.10 21.17 80.24 83.99
6.80 26.00 48.80 68.00 79.30
10.60 42.42 74.28 106.04 12.37
16.07 19.61
48.01 54,91
96.75 116.06
157.68 192.86
-129-
9ANOLAP
Annex 18
Page 15 of 16
Table 10
KIH
Third Inflend Water Tranaort Projeect
Rural LounohLanding Pentoon
Coot*. I.n.f Ito
(Take Hil lI Ions)
:Y E A R:
1991
1992:
1998:
1994:
19t5 :
1996 :
1997 :
199
0
1999
2000
2001 :
2:02 :
2008 :
2004:
2005 :
2006 :
2007 :
200 :
2009 :
2010:
CsTr tPASSS4
STREAM:EITS
7.00
109.20:
109.20:
: FRETH : VESU : TSTAL
: I0FT S s W
UEWI'S :
I
:
t
st
:
:
:s-7.00
3.02 s
0.80 s
1.0S s
10.60 :
12.10 :
26.00s
4.82 :
4242 s
72.0:
16.20
18.20 :
16.20 *
1.20
16.20
16.20
1C.20 :
18.20 S
18.20 :
1 .20:
8.60
21.17:
80.24
31.57 :
1U.20
16.20
18.20 :
1.20 :
16.20:
46.99:
44.97
80.98 :
82.9 :
$4.91:
82.90 :
84.28 t
85.66
$6.9
36.8 :
40.14 :
41.76 :
48.89:
48.01 t
48.80
o5.00
6
67.66 :
70.72 :
78.86:
76.44:
7.80 :
82.79 :
66.21 :
s9.77:
98.26 :
6.7 :
101.00:
106.26s
109.82s
115.77
118.05 s
7.86
10.60
11.29
11.75 :
12.28 :
12.70:
18.16
13.76 :
14.84 :
14.91 :
18.49 :
16.07 I
16.7t:
17.49 :
18.10:
16.60:
19.61t
WV (0123)
UP
74.251 t
106.04
110.71 :
115.87 :
120.04:
124.70:
2.87
125.06
140.75 :
146.45s
282.14
187.68:
164.77:
171.72
176.66
183.61
191.85
*
s
S E N TENSITIVITY
:,Ut Cntea:-15UsnofICW1ngd
I
is Yr Slip:
s -. 72 s -72.00 S -6.72
-. 60 s -114.916 -100.19 s -125S.J
-6.73
-. 16
-78.18:
-116.57
RInS
1.4U
87.64 t
92.51
97.17 :
101.64 s
106.0:
111.17t:
116.66
122.8
t
126.25 :
1s8.94:
106.28 s
146.57
118.82 s
160.46 s
167.41 s
174.85
811.12
96.87:s
-0.49s
6.11
69.76 :
94.44 :
99.11
105.77:
ll.44
:
114.18 :
119.61 i
M22.81t
181.21:
95.04
n.9s
t
75.90 :
.67 t
6811.6:
67.0 0
91.76 :
96.60
101.44 :
106.25 :
111.12.
79.86
-9.n:
145.64
180.7 s
1.78 s
164.66
171.62 s
-47.67:
42.16 s
09.20
78.17
77.14:
3. 10:
68.0?
69.06
93.37 :
96.71
105.85:
66.J83
121.16
M
s
127.76s
188.6
189.S7
?
145.47
115.28:
119.18 s
125.06:
100.98:
186.64
6.621:
22.59:s
a0.9.95
I:
25.06:X
73.67
15.12:s
-130-
$-
:
ml *nS
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als5||||a
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~~~~~~AntMex
16
bTable IS
Page 16 of 16
11
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-131Annex19
Page 1 of 2
TRIRD INLANDWATERTRANSPORTPROJECT
Selected Docu nsnr and Data Available
In the
roject File
1.
BANGLADESH
- 'InlandWaterTransportSector- Fourth FiveYear Plan
PriorityInvestment
Program',May 1990.
2.
BANGLADESH- Third Inland Vater TransportProject - FinalReport, Water
ResourceCongress,Arlington,
Virginia,March 1990.
3.
BANGLADESH- ThirdInlandWater TransportProject- DraftReporton
Organizational
Planning,
Water ResourcesCongress,Arlington,
Virginia,
November1989.
4.
BANGLADESH- ThirdInlandWater TransportProject- DraftReporton
Training,WaterResourcesCongress,
Arlington,Virginia,November1989.
S.
BANGLADESH- ThirdInlandWaterTransportProject- DraftReporton
Dredging,WaterResourcesCongress,Arlington,
Virginia,August1989.
6.
BANGLADESH- ThirdInlandWater TransportProject- DraftReporton
Aids-to-Navigation,
Water ResourcesCongress,Arlington,
Virginia,
August1989.
7.
BANGLADESH- Third Inland Water TransportProject - Draft Report on
Hydrographic
Survey,WaterResourcesCongress,Arlington,
Virgiiia,
.August1989.
8.
BANGLADESH- ThirdInlandWater TransportProject,DraftTechnical
Specifications
for:
-
High FrequencyRadios
NavigationalAids
-
ElectronicShortRangeRadioPositioning
System
-
Global PositioningSystem
Sixty-fourFoot Twin Screw Tug Boat
OutboardPowered Boats
-
Hydrographic
SurveyAccommodations
Barges
Inland Hydrographic Survey Boats
-
Fuel Monitoring System
Dredge Tender Boats
-
Feasibility
Studyfor VHF Telecommunications
FloatingStiffLeg 10-tonCapacityDerricksSystem
Preparedby WaterResourcesCongress,Arlington,Virginia,June 1990.
9.
BIWTCFleetDevelopment
and Rationalization
Study,Drs. P. Sen and I.L.
Buxton,Universityof Newcastle-upon-Tyne,
UnitedRingdom,June 1989.
-132Aknex 19
Page 2 of 2
10. EnvironmentalAssessmentof the Inland Water Transport sector in
Bangladesh,G.E.M. Consultants,Rotterdam,The Netherlands,May 1989.
11.
Draft Terms of Reference and Technical AssistanceProject
Proforma Con,ultancy
Services
for Design and Coordination
of the Third Inland
Water Transport
Project,
April 1990.
12.
Draft Terms of Reforence for Management Consultant
Services
BangladeshInland Water Transport Corporation,
April 1990.
for
13. BANGLADESH- Inland Water TransportMaster Plan, DHV Consulting
Engineers,Witteveen and Bos., The Netherlands,and BETS Ltd., Dhaka,
November 1988.
14.
Bangladesh Transportation
Modelling System, Matrix Group Inc.
Universityof Tennissee,Kr.oxville,
TN, January 1990.
and The
15. BANGLADESH- Third Inland Water TransportProject,Report of Mission to
Review Manpower and Training Issues,Mr. j. Z. Pikus (ILO, Geneva) and
Ms. 0. Schonten (ILO, Bangkok),October 1989.
BANGLADESH
THIRDINLAND WATERTRANSPORTPROJECT
c
MINISTRYOF SHIPPING
Organisatlon Chart
Chief
Nmi"o
~miwyAWrM"OMI
En*r_BmOslnnU*
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eawasoveb
E
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I
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Qiat 2
BANGLADESH
PROJECT
THIRDINLANDWATERTRANSPORT
(BIWTA)
AUTHORITY
INLANDWATERTRANSPORT
BANGLADESH
Orglisatlon Chart
l
Sl
*
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,
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PpdAdmuonftifdMISPrmjW
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BANGLADESH
THIRDINLANDWATER
TRANSPORT
PROJECT
PASSENGER
AND FREIGHT
MOVEMENTS
ON TRANSPORT
NETWORK
PASSENGERS
Li-~~~).
I.,/
I{-
FREIGHT
Supplies
anddemands
arebased
ona Japanese
suand olion data.Modalsplitparameters
wereGal~-ibraedfrom
information
in the hntermodal
t
Supplies
anddemands
andmodalspltparameter
arebasedonlnmocal Transport
Study.
-
Transport
Study.
PERSONS
PER
DAY:
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PER
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'1~~~~~~~~~~~~~~~~~~~~~~~1Y
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BROADGAUGERAIL
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WATR TRANSPORT
iFERRY
CROSSINGS
-
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- --
BROADGAUGERAEL
METER
GAUIGE
RAIL
HlGiAWM'TRANSPORT
WATER
TRANSPORT
FERRY
CROSSINGS
APRIt199~~~~~~~~~~~~
BANGLADESH
THIRDINLAND
WATER
TRANSPORT
PROJECT
INLANDWATERWAY
SYSTEM
DAYMD NIW NANGATON
<
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