Dhaka Metro Rail

The Dhaka Metro, a groundbreaking initiative in Bangladesh’s capital, strives to ease congestion and enhance mobility, aligning with the 20-year Strategic Transport Plan. Line 6’s Phase 1 is active, Phase 2 is slated for 2023, and Phase 3, with an extension at Kamalapur railway station, is expected by 2025. Progressing through different construction and planning stages, the network encompasses six lines, primarily funded by public-private partnership with JICA.

The total investment in Dhaka’s Mass Rapid Transit (MRT) system is projected to exceed Tk 2 trillion, with initial estimates of Tk 94,000 crore being significantly surpassed due to rising costs. Funding comes from foreign sources like the Japan International Cooperation Agency (JICA) and the Asian Development Bank (ADB), with Japan financing 75% of the MRT Line-1 project. The Dhaka Mass Transit Company Limited (DMTCL) manages the projects, which include six metro rail lines planned by 2030 to alleviate Dhaka’s severe traffic congestion and air pollution.
 

Key Aspects of the Investment

• Total Cost and Increase:The total investment in the upcoming MRT Line-1 and MRT Line-5 projects is expected to exceed Tk 2 trillion. This is a significant increase from the government’s initial estimate of Tk 94,000 crore for these two lines, driven by contractor bids and other factors. 
• Foreign Funding:The projects are heavily reliant on foreign investment, with JICA being a major financier. JICA’s strict loan conditions have been cited as a factor contributing to the increased costs. 
• Specific Project Costs:
  • MRT Line-1: Projected cost of Tk 525.61 billion (Tk 52,561 crore). 
  • MRT Line-5: Estimated cost of Tk 412.61 billion (Tk 41,261 crore). 
  • MRT Line-6: The revised project cost stands at Tk 334.72 billion. 
• Financing for Specific Projects:
  • MRT Line-1: JICA is financing 75% of the total cost for this line. 
  • MRT Line-6: Primarily funded by Japan. 
• DMTCL and Project Management:The Dhaka Mass Transit Company Limited (DMTCL) is responsible for the construction and operation of the metro rail network. 

Challenges and Concerns 

• Soaring Costs:The escalating costs are a major concern, with per kilometer costs for Dhaka’s metro exceeding those of similar projects in Asia.
• Financial Sustainability:Experts warn that the high project costs and potential overpricing could lead to heavy subsidies and debt burdens for the government.
• Loan Conditions:Strict loan conditions imposed by foreign lenders like JICA are also contributing to the increased expenses.

Future Investment Outlook

• Local Material Usage:DMTCL plans to increase the use of locally made materials, such as glass and cables, in future metro projects to cut costs and boost local industries. 
• Long-Term Vision:The development of a 140-kilometer metro rail network with six lines is a long-term goal to reduce traffic congestion and improve air quality in Dhaka.