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Promotion and Developmentof the Asian Highway:

Upgrading of Priority Routes

Prefeasibility Study of AH1: Bhatiapara - Benapole Road in

Bangladesh

United Nations

E S C A PECONOMIC AND SOCIAL COMMISSION FOR ASIA AND THE PACIFIC

ECONOMIC AND SOCIAL COMMISSION FOR ASIA AND THE PACIFIC

Promotion and Development of the Asian Highway:

Upgrading of Asian Highway Priority Routes

Prefeasibility Study of AH1: Bhatiapara-Benapole Road in

Bangladesh

UNITED NATIONSNEW YORK, 2007

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This prefeasibility study report has been issued by the Transport and TourismDivision, Economic and Social Commission for Asia and the Pacific (ESCAP). Inputsrelated to the engineering analysis were provided by an external consultant, Mr. HikaruNishimura, from Central Consultants, Japan. Mr. Hiroyuki Kotani provided additionalassistance with the economic evaluation. Mr. A. R. M. Anwar Hossain, former ChiefEngineer of the Roads and Highways Department, Ministry of Communications,Bangladesh, provided relevant data and inputs as the national expert.

The views expressed in this report are those of the authors and do not necessarilyreflect the views of the United Nations Secretariat.

The designations employed and the presentation of the material in this report do notimply the expression of any opinion whatsoever on the part of the Secretariat of the UnitedNations concerning the legal status of any country territory, city or area or of its authorities,or concerning the delimitation of its frontiers or boundaries.

Mention of firm names and commercial products does not imply the endorsementof the United Nations.

This report has been issued without formal editing.

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CONTENTSPage

I. INTRODUCTION.…………………………………………………………………….. 1A. Background ……………………………………………………………………….. 1B. Objective ………………………………………………………………………….. 1C. Selection of Asian Highway priority routes for study ……………………………. 2D. Study organization ………………………………………………………………... 2

II. METHODOLOGY OF PREFEASIBILITY STUDY…………………………………. 3A. General ……………………………………………………………………………. 3B. Limitation of the study ……………………………………………………………. 4C. Data collection ……………………………………………………………………. 4D. Field investigation ………………………………………………………………… 4E. Preparation of improvement plans for the prefeasibility study …………………… 4F. Traffic projection …………………………………………………………………. 5G. Unit cost for the improvement plans ……………………………………………… 5H. Estimation of work quantities …………………………………………………….. 6I. Estimation of project cost ………………………………………………………… 6J. Estimation of economic benefit …………………………………………………... 6K. Economic evaluation ……………………………………………………………… 6L. Environmental and social impact analysis ………………………………………... 7M. Conclusion ………………………………………………………………………... 7

III. PREFEASIBILITY STUDY OF OF BHATIAPARA-BENAPOLE ROAD ………….. 8A. Socio-economic profile of Bangladesh …………………………………………… 8B. Road network in Bangladesh ……………………………………………………... 9C. International road transportation ………………………………………………… 10D. Asian Highway network in Bangladesh …………………………………………. 10E. Road administration ……………………………………………………………... 12F. Budget for road development ……………………………………………………. 13G. Project road ……………………………………………………………………… 13H. Future traffic volume forecast ………………………………………………….... 19I. Improvement plan ……………………………………………………………….. 19J. Preliminary cost estimation ……………………………………………………… 20K. Economic evaluation …………………………………………………………….. 22L. Preliminary environmental and social consideration ……………………………. 28M. Implementation plan ……………………………………………………………... 29

IV. CONCLUSION AND RECOMMENDATION………………………………………. 30A. Conclusion ……………………………………………………………………….. 30B. Recommendation ………………………………………………………………… 30

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ANNEXESPage

I Asian Highway classification and design standards ……………………. 31II Cash flow in evaluation and result (alternative-1, Bangladesh) ....…….. 32III Cash flow in evaluation and result (alternative-2, Bangladesh) ....…….. 33

LIST OF TABLES

Page1. Socio-economic indicators in Bangladesh ………….……………..…... 82. Length of road network in 2004 ..………………………..…..……..…. 93. Asian Highway in Bangladesh ………………………………..…….… 104. Maintenance and development budget of RHD ……………..………... 135. Present traffic volume on the project road …………………..……….... 186. Future traffic volume forecast for the project road …………..………... 197. Alternative improvement plans ..…………………………………….... 208. Preliminary construction cost estimation …..…………………………. 219. Preliminary project cost estimation .…………………………………... 2210. Project component of alternative-1 and alternative-2 ..………………... 2311. Difference between “with-case” and “without-case” ..……….……….. 2412. Basic data on VOC in Bangladesh ..…………………………………... 2513. Average saving in Vehicle Operation Cost (VOC) ......……………….. 2514. Average saving in travel time ...………..…………………………..….. 2615. Allocation of initial cost ..……………………………………………... 2716. Result of evaluation ……………..…………………………………….. 2717. Result of sensibility analysis (alternative-2) …..…………………….... 2818. Tentative implementation plan of project road……..………………….. 29

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LIST OF FIGURES

Page1. Workflow chart of prefeasibility study ………………………….…..… 32: Trunk road network in Bangladesh ………………………………...….. 93: Asian Highway network in Bangladesh ….………………………...….. 114. Organization chart of RHD ….……………………………………….... 125. Project road in Bangladesh (Bhatiapara-Benapole) ….………………... 146. Present situation of the project road between Bhatiapara and Narail ..... 157. Present situation of the project road between Narail and Jessore ….….. 168. Present situation of the project road between Jessore and Sarsa .……... 179. Present situation of the project road near Benapole ..…………………. 1810. Concept for change of alignment ..…………………………………….. 20

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I. INTRODUCTION

A. Background

The Asian Highway (AH) has entered a new phase with the entry into force of theIntergovernmental Agreement on the Asian Highway Network on 4 July 2005. Since itsopening for signature at the sixtieth session of the Commission held at Shanghai in April2004, 28 Member States have signed the Agreement, among which 22 States are Parties1.This speedy entry into force of the AH Agreement clearly demonstrates the commitment ofmember States to developing the regional highway network in the Asia-Pacific region.

One of the main obligations of the Contracting Parties to the Agreement is todevelop the adopted highway network in conformity with the AH classification and designstandards (Annex-I). Currently, about nine per cent (12,000 kilometres) of the 141,000kilometres of the AH network is below the agreed minimum standards. A large portion ofthe substandard sections are found in least developed, landlocked and transit developingcountries, as well as the economies in transition. The poor quality of highways has a directimpact on transport costs for both goods and passenger traffic. It also hinders access tomarkets, health care, education, and women being the most vulnerable social group incommunities often pay a higher price.

Mobilization of financial and technical resources to upgrade and improve the AHnetwork as per the requirements of international transport is a major challenge for allparticipating countries. A recently completed ESCAP study has revealed a shortfall of US$ 18 billion required to improve and upgrade some 26,000 kilometres of the network whichincludes 121 priority projects identified in 25 member States.

The least developed, landlocked and transit developing countries, as well as theeconomies in transition, are facing the biggest challenge in mobilizing sufficient resourcesfor upgrading of highways. Additional technical and financial assistance needs to bemobilized for this group of countries from international organizations, multilateral financinginstitutions and/ or bilateral donors.

In this context, a project titled “Promotion and Development of the Asian Highway:Upgrading of Asian Highway Priority Routes” was implemented by ESCAP to assistmember States in undertaking prefeasibility studies of selected Asian Highway routes.Under the project, a Regional Workshop on Upgrading of the Asian Highway Routes, andan Asian Highway Investment Forum were organized2.

B. Objective

The objective of the project was to provide technical assistance to undertakeprefeasibility studies of selected priority AH routes, and facilitate dialogue among memberStates, multilateral financing institution, bilateral donors, subregional organizations as wellas the private sector, for development of AH routes. The outcome of the studies will bepresented at a regional workshop and a regional investment forum, to promote investmentand showcase the investment environment and prospects in member States.

1 Status as of December 20072 http://www.unescap.org/ttdw/common/Meetings/TIS/Regional-WS-19-21June2007.asp

http://www.unescap.org/ttdw/common/TIS/AH/ah_investment_forum.asp

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C. Selection of Asian Highway priority routes for study

A priority section of the Asian Highway in Armenia, Bangladesh, Mongolia andMyanmar representing Central Asia and Caucasus, South Asia, North-East Asia and SouthAsia respectively, was selected based on the proposals received from each country. Theselected roads are existing or potential AH routes.

The four Asian Highway routes selected for prefeasibility studies are:(i). Armenia, AH82: Goris-Kapan section;(ii). Bangladesh, AH1: Bhatiapara-Narail-Jessore Benapole section;(iii). Mongolia, AH32: Ondorhaan-Choybalsan -Nomrog-Sumber-Arshan section;(iv). Myanmar, Monya-Kalewa road, alternate route for existing AH1.

All the above-mentioned routes are currently below minimum standards, and need tobe upgraded to meet minimum Class-III of the Asian Highway design standards (Annex –I).

This report concentrates on the prefeasibility study of Asian Highway (AH1)Bhatiapara-Narail-Jessore-Benapole road in Bangladesh, an important AH route connectingBangladesh and India.

D. Study organization

The prefeasibility study has been carried out in cooperation with officials of Roadsand Highway Department, Bangladesh. Mr. A. R. M. Anwar Hossain, former ChiefEngineer, Roads and Highways Department, Ministry of Communications, was the focalpoint, and assisted in the collection of national data, and during an assessment mission. TheTransport and Tourism Division at ESCAP provided overall management and supervisionof the study. Mr. Hikaru Nishimura and Mr. Hiroyuki Kotani provided inputs related to theengineering analysis and economic evaluation respectively.

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II. METHODOLOGY OF PREFEASIBILITY STUDY

A. General

The primary goal of the prefeasibility study was to assess the scope of improvementfor the 94 kilometres existing AH1: Bhatiapara-Narail-Jessore-Benapole road section inBangladesh, from an engineering, economic, social and environmental point of view, and toprepare a study report for consideration by the Government and donor community, forpromotion of investment.

The prefeasibility study included the following considerations:(i). Preliminary investigation and assessment of project road;(ii). Future traffic projection;(iii). Estimation of preliminary costs and benefits for preliminary economic

evaluation (IRR, B/C, NPV);(iv). Assessment of development and spill over impacts of the route development;(v). Preparation of preliminary prefeasibility study report.

The methodology illustrated in Figure 1 was used to carry out the prefeasibilitystudy, and it is in effect, a simplified version of the process used for conducting a feasibilitystudy.

Figure 1. Workflow chart of prefeasibility study

Estimation of unit costof improvement* Road* Bridge* Engineering* Economic

Field survey

Confirmation of roadimprovement plan(s)

Collection of data* Engineering* Economic* Social

Estimation of uniteconomic cost* Vehicle operation* Time saving

Review of previousF/S reports

Estimation ofproject cost

Estimation ofeconomic benefit

Preliminary economicevaluation(B/C, NPV, EIRR)

Recommendations

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B. Limitation of the study

It is important to note that this study is only a prefeasibility study carried out toassess the preliminary feasibility of upgrading the selected Asian Highway route forpromotion of investment. The study has additional limitations in terms of budget, durationof missions and site investigation, and availability of data, maps etc.

As a result, an improvement plan with a large scale change of alignment has notbeen proposed, unless an alternate route is proposed by the country. Furthermore, it shouldbe noted that traffic projection, cost estimation and economic evaluation are preliminary,and need to be confirmed by a full scale feasibility study or during the detail design stage.

C. Data collection

Prior to undertaking the mission to Bangladesh and a field investigation of theproject road, a detailed questionnaire was sent to the focal point in Bangladesh, to collectnecessary data and relevant information.

The key areas addressed by the questionnaire are listed below:(i). Road and bridge inventory;(ii). Latest traffic data;(iii). Traffic accident data;(iv). Rough unit construction cost;(v). VOC and time saving;(vi). Previous prefeasibility/ feasibility study report(s);(vii). Socio-economic information (population, number of schools, health facilities

etc.).

The counterpart official provided the data and information during the mission.

D. Field investigation

An official mission to Bangladesh and a field visit to theBhatiapara-Jessore-Benapole route were undertaken during 4-8 April 2007. During themission, the study team conducted a field visit and an onsite investigation of the projectroad, with the cooperation of counterpart personnel from the Roads and HighwaysDepartment of Bangladesh. The study team also met with officials from the Ministry ofCommunications, the Roads and Highways Department, field engineers who are in chargeof the maintenance of the project road, and local residents and businessmen at Benapole.The purpose of the field investigation was as follows:

(i). Conduct an engineering evaluation to ascertain need for improvement;(ii). Confirm constraint(s) for improvement;(iii). Define scope of upgrading;(iv). Confirm environmental and social conditions along the project road.

E. Preparation of improvement plans for the prefeasibility study

Based on the available data, outcome of the field visit, and discussion with officials,alternate improvement plans were developed by the study team in order to upgrade theproject road to meet the Class II (7 m carriageway with Asphalt Concrete pavement) of theAsian Highway Classification and Design Standards. Annex–I includes key parameters ofAH design standards. Alternatives prepared included minimum requirements to upgradeproject road to meet AH standard, and a full scale improvement to upgrade the condition of

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the project road. Change of alignment is considered at Jhingergacha to bypass the populatedarea and settlement.

For preparation of improvement plans, the following points were considered:(i). Analysis of existing alignments - with topographical maps and Google aero

photographs;(ii). Analysis of the present condition of the project road - with road/bridge

inventory data, results of field investigation and scope of work;(iii). Alternatives prepared as minimum required components and full scale

improvement with large scale investment.

F. Traffic projection

1. Present traffic data

Due to limited duration of the mission, the study team did not carry out a trafficsurvey at the site. Instead, the traffic survey conducted by the Roads and HighwaysDepartment, and traffic projection made for the Road Master Plan Study was used for thestudy. The Roads and Highway Department provided traffic volume data for the projectroad, and other roads influencing the project road. At the same, the study team hasconfirmed traffic characteristics and international transport movements at Benapole, duringthe field visit and site investigation.

2. Future traffic projection

In case of a feasibility study, future traffic projection is carried out in the followingmanner:

(i). Traffic survey, including Origin/Destination (O/D) survey;(ii). Formulation of O/D matrix;(iii). Future traffic demand forecast by traffic zone considering economic

development, vehicle registration growth, etc.(iv). Traffic assignment on project road for “with project case” and “without project

case”.

Due to constraints of the study, this comprehensive method for future trafficprojection has not been used in this prefeasibility study. Instead, future traffic projection isestimated based on the present traffic volume, traffic growth rate projected by Road MasterPlan Study or GDP growth rate, considering potential traffic diversion and/or generation.

G. Unit cost for the improvement plans

In case of a feasibility study, unit costs for the improvement plan are estimatedaccording to the procedure below:

(i). Analysis of unit cost by detailed work item (e.g. earth work, pavement work,concrete work, etc.);

(ii). Estimation of unit costs at project site, including transportation cost ofmaterials and equipment, etc;

(iii). Accumulation of unit costs of detailed work items into work items for quantityestimation;

(iv). Unit cost is usually estimated in local currency.

In the prefeasibility study, unit construction and rehabilitation costs, as shownbelow, and provided by the counterpart official (in US $), are adopted as unit costs forimprovement in the study:

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(i). Construction of new road;(ii). Rehabilitation of existing road;(iii). Rehabilitation of pavement;(iv). Construction of new concrete bridge;(v). Maintenance of existing road.

H. Estimation of work quantities

In the prefeasibility study, work quantity of each improvement plan is estimatedbased on the road/bridge inventory data, and results of the field investigation. It should benoted that estimated work quantities are at a preliminary level, and it will be necessary toverify these quantities during an actual feasibility study and/or detail design stage.

I. Estimation of project cost

In the prefeasibility study, improvement costs are estimated by multiplying thepreliminary work quantities by unit cost of work components. The following assumptionsare made while estimating the project cost:

(i). Project life is considered as 25 years from 2007;(ii). Implementation of work will commence in 2008;(iii). Duration of improvement work is three years;(iv). Periodic maintenance work will be carried out every 10 years;(v). Routine maintenance work will be carried out every year;(vi). Preliminary improvement cost is estimated in US $.

J. Estimation of economic benefit

In order to carry out an economic evaluation for each of the proposed alternatives,unit values for evaluation are estimated for the following items:

(i). Vehicle Operating Cost (VOC);(ii). Time value;(iii). Unit value for evaluation is estimated based on existing feasibility study

reports and other related reports;(iv). Shadow rate to be applied, if there is a big difference between official and

market exchange rates.

Economic benefits are estimated from differences of VOC and time cost between“without-case” (no improvement) and “with-case” (with improvement). Only quantitativebenefits are considered in benefit estimation. Indirect benefits, such as “increasingagricultural products”, “reducing cargo damage”, and “improvement of driving comfort” arenot considered for economic benefit estimation.

K. Economic evaluation

An economic evaluation is conducted for the most comprehensive alternative first,and then the second alternative is evaluated, if the first alternative is judged unfeasible. Thebasic assumptions made for the economic evaluation are listed below:

(i). Discount rate of 12 per cent is used for economic evaluation;(ii). Economic evaluation period is set as 25 years from 2007;(iii). Market price in 2007 is used as basic price.

Using the cash flow of economic cost and economic benefit, Internal Rate of Return(IRR), Net Present Value (NPV), and Benefit Cost Ratio (B/C) are calculated for thealternatives according to the formulae below:

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Where, Ct = total cost, Bt= total benefit, t = year, n = project life, i =discount rate

Since project cost and benefit can change due to unexpected socio-economicchanges, fluctuation of foreign exchange rate etc., a sensitivity analysis is conducted. In thisanalysis, the project cost (initial cost) and benefit (which is mostly influenced by trafficvolume) has been assumed to change within a range of ±10 per cent and ± 20 per cent.

L. Environmental and social impact analysis

Initial environmental and social impacts of the project, such as influences on naturalenvironment, resettlement and communities, are assessed based on field observation anddiscussion with site officials. Social impacts of the project, such as gender issues, povertyalleviation are assessed based on the findings from the field visit, site observation andavailable socio-economic data. Contribution to promotion of international linkages,transport, and regional economic cooperation are also considered within the study.

M. Conclusion

Conclusions will be drawn based on the outcome of an engineering assessment andan economic evaluation of the project road, adopting the aforementioned methodology. Theprofile and importance of the project will be much higher, with indicators such as forecastedtraffic, IRR, B/C, NPV indicating the economic viability of the project, as derived from theavailable and/ or collected data. A detailed feasibility study will be necessary to verify thecosts, and estimate detailed investment needs. The need for, as well as the importance of,improving the project road is recognized, and countries may approach donors with theresults of the prefeasibility study.

n

IRR = i , (Bt - Ct) / ( 1 + i)t=0

t=i

n n

NPV = Bt / (1 + i)t- Ct (1 + i)

t

t=i t=i

n n

B/C = ( Bt / (1 + i)t)/ ( Ct (1 + i)

t)

t=i t=i

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III. PREFEASIBILITY STUDY OF BHATIAPARA-BENAPOLE ROAD

A. Socio-economic profile of Bangladesh

1. Country profile

Bangladesh is located in the eastern part of the Indian subcontinent, and is adjacentto the Bay of Bengal. Bangladesh is surrounded by India in the east, the west and the north,and shares a border with Myanmar in the south-eastern area.

2. Topography and climate

Bangladesh is located on the large delta formulated by the Padma River, and otherrivers, and hence most of its land is flat terrain.

Bangladesh has a tropical climate with a seven month long rainy season betweenApril and October. In addition, tropical storms (cyclones) often hit Bangladesh, resulting inheavy casualties, flooding, and other serious damage to the land mass and property,including the road network.

3. Socio-economic condition

Table 1 lists key socio-economic indicators in Bangladesh.

Table 1. Socio-economic indicators in Bangladesh3

1. Area: 144,800 km2

2. Population: 159 million (2007)3. Capital city: Dhaka4. Official language : Bengali5. Major industry: Garments processing6. GDP: US $ 71,908 million (2006)7. GDP per capita: US $ 461 (2006)8. Economic growth rate: 6.5% (2006)9. Inflation Rate: 6.3% (2006)10. Employment: 60 million people (2000)

a. Agriculture (64.8%), Service (24.5%), Mining and Industry (10.7%)11. Trade value (2006)

a. Export: US $ 12,277 million,b. Import: US $ 16,017 million

12. Major trade commodities (2004, JETRO)a. Export: Garment products, Frozen food, Jute product, leather productb. Import: Textile goods, Petroleum product, Machinery

13. Major trade partnera. Export: United States, Germany, United Kingdom, France, Italyb. Import: China, India, Singapore, Japan, Hong Kong, China, Republic of Korea

14. Currency: Taka, US $1=Taka 68.93 (2006)

3 Source:Statistical Yearbook for Asia & the Pacific 2007,UNESCAP

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B. Road network in Bangladesh

As per 2004 estimates, the total length of the road network in Bangladesh is 240,000kilometres and it consists of national and regional highways, and district roads. Table 2shows the classified road network in Bangladesh.

Table 2. Length of road network in 2004Road type Total Length (km) Road administrator

National Highway 3,086 RHDRegional Highway 1,751 RHDZilla Road 15,962 RHDSub-total 20,799Upazilla Road 36,343 LGEDUnion Road 43,874 LGEDVillage Road 138,891 LGEDSub-total 218,908Total 239,707

Most of the National and Regional Highways are paved. Figure 2 illustrates thetrunk road network in Bangladesh.

Figure 2. Trunk road network in Bangladesh

The boundaries and names shown and the designations usedon this map do not imply official endorsement or acceptanceby the United Nations

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Since Bangladesh is a very flat country located on the river delta, there are manyroad sections which require crossing over big rivers. In 2001, construction of the JamunaRiver Bridge, one of the largest rivers in Bangladesh, was completed, and it physicallyconnected the western and the eastern parts of Bangladesh for the first time.

In addition, a feasibility study has been carried out for construction of the PadmaBridge, spanning about 6 kilometres over the Padma River, which is located down stream ofthe Jamuna River. The proposed Padma Bridge will serve as an effective link between thesouth-western and the north-eastern parts of Bangladesh, as well as with the capital cityDhaka. As a part of this initiative, road infrastructures in these regions has already beendeveloped and improved by completing the implementation of the South-east RoadNetwork Development Project (SRNDP), and the Dhaka-Sylhet Highway in thesouth-western and north-eastern parts respectively. Another project to improve the roadnetwork, namely Sylhet - Tamabil - Jaflong Road Development has also been completed.

C. International road transportation

Bangladesh is surrounded by India and Myanmar, and there are eight border checkposts with India, and two with Myanmar. Within those border posts, Benapole border postwith India is the most important and busy border crossing by road because of large scaletransportation of goods and passengers between Dhaka and Kolkata. Maximum landtransport between Bangladesh and India is being done through the Benapole Land Port.

The border crossing at Banglabandh in the north is used for import and export oftransit cargo between Nepal and Bangladesh. This border is not used for import and exportof goods to, and from India, and neither is it used for passenger travel. The immigrationposts and custom offices in the border of Bangladesh and India are temporary.

D. Asian Highway network in Bangladesh

The Asian Highway network in Bangladesh consists of three routes, namely AH1,AH2, and AH41, as shown in Table 3 and Figure 3.

Table 3. Asian Highway in Bangladesh4

AH no. Border and major cities Length(km)

AH1 Tamabil (Border of India) – Sylhet – Katchpur – Dhaka – Banga –Jessore –Benapole (Border of India) 497

AH2 Tamabil (Border of India) – Sylhet – Katchpur – Dhaka – Tangail –Hatikamrul – Bogra – Rangpur – Banglabandh (Border of India)

512

AH41 Teknaf – Cox’s Bazar – Chittagong – Comilla – Kachapur –Dhaka –Hatikamrul – Paksey – Jessore – Khulna - Mongla

752

Total 1,761

4 Asian Highway Database, 2006, UN ESCAP

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Figure 3. Asian Highway network in Bangladesh

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E. Road administration

The four agencies responsible for road administration in Bangladesh are listedbelow:

1. Ministry of Communications

Ministry of Communications has the responsibility for formulating land transportdevelopment and communication policies, including planning in Bangladesh. The leadimplementing agency for construction and maintenance of trunk roads is the Roads andHighways Department mentioned below.

2. Roads and Highways Department( RHD)

RHD has the responsibility for planning, design, construction and maintenance ofmajor road networks, including National Highways, Regional Highways, and a part ofdistrict roads. In addition, RHD also operates ferry services across medium size and smallsize rivers in Bangladesh. The organization chart of RHD is shown in Figure 4.

Figure 4. Organization chart of RHD

3. Local Government Engineering Department (LGED)

LGED is responsible for planning, construction and maintenance of majority of thedistrict roads, such as Upazila Roads, Union Roads and Minor Village Roads.

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4. Jamuna Multipurpose Bridge Authority (JMBA)

JMBA was established under the aegis of the MOC, for the construction of JamunaBridge, and it is responsible for construction and maintenance of the Jamuna Bridge and itsapproach roads. In addition, a new long span bridge to cross Jamuna River and Padma Riverwill also be under the jurisdiction of JMBA.

F. Budget for road development

Table 4 shows past budget trends for road development and maintenance inBangladesh. Within the development budget, projects with foreign-aid occupy a share ofabout 40 to 50 per cent.

Table 4. Maintenance and development budget of RHD5

(Unit: million Taka)Maintenance budget Development budget

Fiscalyear Total Routine

maintenancePeriodic

maintenance Total Investmentproject

Technicalassistance

project

Grandtotal

1996-97 2,120 2,120 0 9,981 9,897 84 12,101

1997-98 2,470 2,470 0 10,992 10,871 121 13,462

1998-99 2,700 2,700 0 15,256 15,031 225 17,956

1999-00 2,810 2,810 0 17,693 17,536 157 20,503

2000-01 2,900 2,900 0 24,620 24,496 124 27,520

2001-02 3,310 2,408 902 22,172 22,046 126 25,482

2002-03 3,750 2,896 854 22,986 22,892 94 26,736

2003-04 5,760 3,760 2,000 24,734 24,443 291 30,494

2004-05 6,000 4,000 2,000 20,466 20,276 190 26,466

G. Project road

Roads and Highways Department of Bangladesh has proposedBhatiapara-Narail-Jessore-Benapole road section of AH1 as a candidate section for theprefeasibility study under the subject UNESCAP project, i.e. Promotion and Developmentof the Asian Highway: Upgrading of Asian Highway Priority Routes.

1. Project location

The selected road section under the purview of this project is largely located inwestern Bangladesh, in the Khulna Division, connecting newly completed NationalHighway N805 at Bhatiapara and Benapole, the border crossing point with India. The roadpasses through Narail and Jessore. Figure 5 shows the location of the project.

5 Source: Road and Highway Department

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Currently the transportation of goods and passengers between Dhaka and Benapoleis mostly undertaken through Benapole-Jessore-Magura-Madhukhali-Goalanda-ArichaFerry-Manikganj-Dhaka route, as indicated by the blue line in Figure 5. This movement ofpeople and goods takes place via the Aricha Ferry instead of the Mawa Ferry (which inreality is a shorter route), due to the factors outlined below:

(i). Section between the Kalna River and Narail has very bad road surfacecondition;

(ii). Section between Kalna River and Jessore has narrow carriageway width of 5.5m;

(iii). Vehicles have to use ferry service to cross the Kalna River operated by RHD.(iv). Even though the distance between Dhaka and Benapole through the Mawa

Ferry and Narail is much shorter than via the Aricha Ferry, waiting time andcrossing time of Mawa Ferry is actually much longer than the Aricha Ferry.

Figure 5. Project road in Bangladesh (Bhatiapara – Benapole)

2. Present situation of the project road

The length of project road connecting Bhatiapara and Benapole is 94 kilometres. There is aferry crossing the Kalna River. The section of road from Bhatiapara towards Dhaka, and thesection from Jessore towards Benapole, are of National Highway Standard. On the otherhand, the intermediate sections from Jessore to Narail, and from Narail to Bhatiapara, are ofa Regional Highway and Zilla Road Standard respectively. Since the surface conditionbetween Kalna River and Narail is very poor, there is no national and/ or internationaltraffic across this road, even after the completion of road improvement of N8 and N805between Dhaka and Bhatiapara.

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(a) General condition

(i) Section between Bhatiapara and Narail

This section is 24 kilometres in length, including a ferry crossing part of KalanaRiver. Figure 6 shows the present situation of road between Bhatiapara and Narail. TheProject road starts at a roundabout on National Highway N805, near Bhatiapara town. Theaccess road to the Kalna Ferry Ghat (terminal) is about 3 kilometres in length, and it has anarrow carriageway of 3.7 m with bituminous coated brick pavement. This pavement hassubsequently deteriorated. The width of the Kalna River at the Ferry crossing is about 400m. From the western side of the Kalna River, to the eastern end of Narail Bypass (ZillaRoad Z7503), road condition is the worst on the project road, with totally deterioratedbituminous coated brick pavement, due to lack of periodic and regular maintenance workover the last few years, owing to lack of budgetary allocation. Furthermore, carriagewaywidth of this section is 5.5 m, which is below the AH Class III standard, even though anewly constructed bridge over the Nabaganga River, and some box culverts have asufficient width of more than 7 m. RHD has constructed the eastern part of Narail Bypass,together with a bridge over the Chitra River. RHD plans to extend this bypass up to theexisting Regional Highway R705 soon.

Figure 6. Present situation of the project road between Bhatiapara and Narail

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(ii) Section between Narail and Jessore

This section is 32 kilometres in length. Figure 7 shows the present situation betweenNarail and Jessore. The carriageway of this section was widened from 3.7 m to 5.5 m byRHD a few years ago. At the same time, the pavement was improved to asphalt concretepavement. However, this section is still under the minimum AH standard in terms ofcarriageway width. There is a one-lane bridge crossing over the Atra Khal River, whichneeds to be widened and reconstructed.

Figure 7. Present situation of the project road between Narail and Jessore

(iii) Section between Jessore and Benapole

This section is 38 kilometres in length. Figures 8 and 9 show the present situationbetween Jessore and Sarsa, and near Benapole, respectively. The carriageway of this sectionwas widened from 5.5 m to 7.0-7.6 m by RHD, and pavement was improved to asphaltconcrete pavement. Since there are many large roadside trees along this section, sufficienthard shoulder width could not be provided at many parts of this section. Even though thepavement was improved within the last rehabilitation programme, no improvement work ofsub-grade was carried out. Due to heavy traffic load, including trucks and trailers carrying

17

import and export goods through Benapole border crossing point, and effects of inundationin 2000, about 16 kilometres of the pavement in this section has deteriorated. AtJhingergachha town, the project road passes through the center of the town, and it isdifficult to widen the carriageway. In addition, the Kapotakkha Bridge has 5.5 mcarriageway width. In Benapole town, about one kilometre of the road section is dualcarriageway with 8.9 m width. However, traffic flow is often disturbed by the trucks parkedby the road side. In order to divert trucks from the existing road in Benapole town, RHDplans to construct a bypass directly connecting a truck terminal and the cargo transhipmentspace in the Indian Customs Area. A section of this bypass has already been completed.

Figure 8. Present situation of the project road between Jessore and Sarsa

18

Figure 9. Present situation of the project road near Benapole

(b) Traffic condition

RHD has carried out traffic volume counting on major roads, and the AADT (from2004) for the project road was made available to the study team. Table 5 summarises trafficvolume in different sections of the project road.

Table 5. Present traffic volume on the project road

Section Car Bus Truck Others Total

Bhatiapara – Kalna 14 157 229 84 484

Kalna – Narail 37 273 127 200 837

Narail – Jessore 76 360 151 149 736

Jessore – Benapole 435 908 1265 234 2,842

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H. Future traffic volume forecast

Traffic volumes on major trunk roads have been forecasted under a Road MasterPlan Study undertaken by the RHD. According to this study, present traffic volumes (2006)and forecasts for three sections of the project road are shown in Table 6, with an assumptionthat the Padma Bridge will be completed in 2015, and a part of the project road betweenLohagora and Jessore will be upgraded to AH standard by 2015. Additional factors such asan abrupt increase of diverted traffic due to construction of the Padma Bridge and the KalnaBridge, and an improvement of the Bhatiapara - Jessore road section may not have beenconsidered in forecasting traffic volume in the Road Master Plan Study.

However, this project considers that every component of the project road will becompleted by 2010, and the Padma Bridge will be completed by 2015. Hence, the futuretraffic volume of the project road is forecasted considering the growth rate used in the RoadMaster Plan Study.

In this future traffic volume forecast, the main assumptions are:(i). Before the completion of the Padma Bridge (by 2015), the main transport

corridor between Dhaka and Jessore is through the Aricha Ferry, due to thelonger ferry crossing time at Mawa. Post completion, most of the traffic willdivert to the Padma Bridge.

(ii). Trade with India through Benapole border crossing point will increase.(iii). Traffic volume in Bhatiapara – Kalna and Kalna – Narail sections will be the

same after completion of the Kalna River Bridge. Hence, these sections can beconsidered as one link.

Table 6. Future traffic volume forecast for the project road

Section Year Car Bus Truck Others TotalBhatiapara – Narail 2004 37 273 127 200 837

2010 41 356 135 261 7932015 839 1,688 1,637 542 4,7062020 937 2,202 1,736 707 5,5822025 1,046 2,873 1,841 922 6,6822030 1,168 3,748 1,952 1,203 8,071

Narail – Jessore 2004 76 360 151 149 7362010 85 470 160 194 9092015 883 1,802 1,662 475 4,8222020 986 2,351 1,762 620 5,7192025 1,101 3,067 1,868 809 6,8452030 1,229 4,001 1,981 1,055 8,266

Jessore – Benapole 2004 435 908 1,265 234 2,,8422010 606 939 1,762 323 3,6302015 799 966 2,323 423 4,5112020 1,053 993 3,062 553 5,6612025 1,388 1,021 4,036 723 7,1682030 1,830 1,050 5,320 946 9,146

I. Improvement plan

Based on the results of the site investigation, and discussion with RHD officials, theproposed improvement plans for project road are outlined in Table 7, as below:

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Table 7. Alternative improvement plansSection Contents of improvement plan Quantity

Bhatiapara – Kalna 1. Total reconstruction of the road alongKalna River

3 km

Kalna River 1. Construction of Kalna Bridge 600 mKalna – NarailBypass

1. Total reconstruction of the road 18 km

Narail – JessoreAlternative-1

1. Total reconstruction of the road2. Reconstruction of Atra Khal River Bridge

30 km50 m

Narail – JessoreAlternative-2

1. Partial reconstruction of the road2. Reconstruction of Atra Khal River Bridge

30 km50 m

Jessore – BenapolAltenative-1

1. Total reconstruction of the road2. Construction of Jhingergacha Bypass3. Construction of New Kapotakkha Bridge

35 km3 km

120 mAltenative-2 1. Partial reconstruction of the road

2. Overlay of the pavement3. Construction of Jhingergacha Bypass4. Construction of New Kapotakkha Bridge

15.5 km19.5 km

3 km120 m

Since no detailed investigation was carried out in the course of the prefeasibilitystudy, the following assumptions for consideration of improvement plans have been made:

(i). Kalna Bridge will be constructed at the same location as the existing ferrycrossing. At the same time, there will be no change of alignment for the accessroad of the Kalna Bridge.

(ii). Alignment of Jhingeracha bypass proposed in this study is tentative(iii). Deflection values for Bhatiapara-Benapole section are high, and hence, this

section needs complete reconstruction, and alternative-1 proposed in Table 8 isthe complete reconstruction option.

Concept of Improvement Plan at Kalna Concept of Improvement Plan at JhingergachaFigure 10. Concept for change of alignment

J. Preliminary cost estimation

1. Unit cost

RHD has provided the following unit cost estimates for road and bridge constructionwork to the study team:

(i) Total reconstruction of 1 km of paved road US $ 590,000 (Taka 40 million)

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(ii) Partial reconstruction of 1 km of paved road US $ 220,000 (Taka 25 million)(iii) Overlay of pavement US $ 120,000 (Taka 8 million)(iv) Construction of 1 meter of new concrete bridge US $ 10,000 (Taka 700,000)

2. Preliminary project cost estimation

(a) Preliminary construction cost estimation

Based on the work items under each alternative and the unit cost, preliminaryconstruction cost for each alternative is estimated, and shown in Table 8. In this estimation,it should be noted that unit cost of reconstruction of road structure is assumed as the averagecost between new construction and rehabilitation of paved road, as provided by RHD.

Table 8. Preliminary construction cost estimationAlternative Section Contents Quantity Unit

costCost

(US $ inthousand)

Bhatiapara- Kalna

1. Total reconstruction ofthe road along Kalna River

3 km 590,000 1,770

Kalna River 1. Construction of KalnaBridge

600 m 10,000 6,000

Kalna -NarailBypass

1. Total reconstruction ofthe road

18 km 590,000 10,620


30 km 590,000 17,700Narail -Jessore

2. Reconstruction of AtraKhal River Bridge

50 m 10,000 500


35 km 590,000 20,650

2. Construction ofJhingergacha Bypass

3 km 590,000 1,770

Jessore -Benapole

3. Construction of NewKapotakkha Bridge

120 m 10,000 1,200

Alternative-1

Total 60,210Bhatiapara- Kalna


3 km 590,000 1,770


600 m 10,000 6,000

Kalna -NarailBypass


18 km 590,000 10,620

1. Partial reconstruction ofthe road

30 km 220,000 6,600Narail –Jessore


50 m 10,000 500


15.5 km 220,000 3,410

2. Overlay of the pavement 19.5 km 120,000 2,340


3 km 590,000 1,770

Jessore -Benapole


120 m 10,000 1,200

Alternative-2

Total 34,210

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(b) Rehabilitation and maintenance cost estimation

In case of rehabilitation and maintenance cost of the project road, it is assumed thatrehabilitation of pavement (periodic maintenance- same quantity as the result of HDM IVanalysis) will be carried out every ten years, while routine maintenance will be carried outevery year.

(c) Preliminary project cost estimation

Based on estimated construction cost, periodic and routine maintenance cost, thetotal project cost of each alternative is estimated, and shown in Table 9. In this estimation,the period of construction for alternatives 1 and 2 is assumed as three years.

Table 9. Preliminary project cost estimation(Unit: US $ 1000)

Year Alternative-1 Alternative-22008 20,070 11,4032009 20,070 11,4032010 20,070 11,4032011 534 5342012 534 5342013 534 5342014 534 5342015 534 5342016 534 5342017 534 5342018 534 5342019 534 5342020 2,670 2,6702021 534 5342022 534 5342023 534 5342024 534 5342025 534 5342026 534 5342027 534 5342028 534 5342029 534 5342030 2,670 2,6702031 534 5342032 534 534Total 76,230 50,230

K. Economic evaluation

1 General

In order to evaluate the project from a national economic viewpoint, it was essentialto estimate the economic benefits and economic costs generated by implementation of theproject. The evaluation was based on the conventional discounted cash flow method. Threeevaluation indicators, i.e., Internal Rate of Return (IRR), Net Present Value (NPV), andBenefit-Cost Ratio (B/C), were adopted. These indicators are calculated on the basis of adiscount rate of 12 per cent.

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In the previous section, two alternatives were proposed for the road improvement,and both alternatives are analyzed under this economic evaluation.

Table 10. Project component of alternative-1 and alternative-2Alternative Section Contents Quantity Unit

CostCost

(US $ inthousand)

Bhatiapara –Kalna


3 km 590,000 1,770


600 m 10,000 6,000

Kalna - NarailBypass


18 km 590,000 10,620


30 km 590,000 17,700Narail –Jessore


50 m 10,000 500


35 km 590,000 20,650


3 km 590,000 1,770

Jessore –Benapole


120 m 10,000 1,200

Alternative-1

Total 60,210Bhatiapara -Kalna


3 km 590,000 1,770


600 m 10,000 6,000

Kalna - NarailBypass


18 km 590,000 10,620


30 km 220,000 6,600Narail -Jessore


50 m 10,000 500


15.5 km 220,000 3,410

2. Overlay of thepavement

19.5 km 120,000 2,340


3 km 590,000 1,770

Jessore -Benapole


120 m 10,000 1,200

Alternative-2

Total 34,210

Regarding the existing road, past study reports for development plans have made thefollowing observations:

(i). Benapole is the most important and busiest international border crossing pointin Bangladesh ;

(ii). In 2004, approximately 400 – 500 trucks moved via Petrapole – Benapoleborder station;

(iii). International trade between India would accelerate through Benapole, andplans for expanding the land port station at Benapole were established toreduce waiting time and handling time for cargo;

(iv). Formation of an international network providing a strong road link for a part of

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the Asian Highway, AH1 is important;(v). The Padma Bridge is planned to be constructed on the Asian Highway AH1,

and the opening of this bridge will emphasize the importance of AH1 in termsof international trade;

(vi). According to the “Vehicle Operators Survey 2004” in Bangladesh,improvement of road networks will help to bring about a travel time savingand VOC saving of 21 per cent and 14 per cent respectively.

2. Basic Assumption

Following assumptions are made for economic evaluation;

(i). Construction period: Three years is considered as the construction period forboth alternative 1 and alternative 2. This assumption was made afterconsidering past history of road construction works in Bangladesh.

(ii). Discount rate: The discount rate for the analysis has been set at 12 per cent.This figure was adopted as a discount rate in the recent feasibility study forroad development in Bangladesh.

(iii). Period for evaluation: Twenty five years, including three years forconstruction, has been set as the period for evaluation. Construction work willstart in 2008, and will be completed in 2010.

(iv). Basic Price: Market price in 2007 is basic price (economic price convertedfrom market price will be used for the analysis).

3. Concept of “with-case” and “without-case”

It is necessary to define the concept of “with-case” and “without-case” to understandthe benefits of the project, since some benefit items are defined in terms of the differencebetween their cost of “without-case” and “with-case.”

The concept of “without-case” includes following situations in this analysis;(i). All vehicles must stop and wait for the ferry transportation at two locations

(Mawa and Kalna).(ii). Driving speed on the project road is limited due to poor surface condition.(iii). Development activities will be on lower side along the project road.

Table 11. Difference between “with-case” and “without-case”Item With-case Without-case

Ferry transportation at two rivers - XAsphalt concrete pavement and other works inalternative-1 X -

Rehabilitation of asphalt concrete pavement every10 years X X

Annual (routine) maintenance X X

4. Benefit calculation

Comparing “with-case” and “without-case”, several benefits can be abstracted, asshown below:

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(a) Vehicle Operation Cost (VOC) savings

As mentioned previously, VOC will be reduced by 14 per cent approximatelycompared with trip before road improvement, according to the “Vehicle Operation Survey2004” in Bangladesh.

Table 12. Basic data on VOC in Bangladesh(Unit: Taka)

Item Passengercar Bus Truck Heavy

truck Trailer

New vehicle price 1,049,000 2,681,000 949,000 1,309,000 1,309,000Replace tyre 1,803 6,999 3239 7524 7524Fuel (per litter) 25 35 35 35 35Oil (per litter) 48 48 48 48 48Maintenance labour/hr 56 56 56 56 56Crew wage (per hr) 12 35 15 24 24Annual overhead 74,000 217,000 52,000 97,000 97,000No. of wheels 4 6 6 6 6No. of axles 2 2 2 3 3Annual km 50,000 129,800 74,000 80,700 80,700Annual work hours 1,276 2,864 1,748 2,036 2,036Average life 5 5 8 9 9Passengers 1 40 0 0 0Fuel efficiency (l/km) 0.125 0.33 0.33 0.5 0.5

Table 13. Average saving in Vehicle Operation Cost (VOC)6

VehicleType Auto Bus Truck Heavy

Truck Trailer Average

Per cent oftravel time 24 13 19 13 - 14

(b) Travel time saving

(i) Travel time saving caused by improvement of road surface condition

As in the case of VOC saving mentioned above, “Vehicle Operation Survey 2004”shows a travel time saving, compared with a trip before the road improvement, in thefollowing table:

6 The original table in “Vehicle Operation Survey, 2004” shows other vehicle types. In this analysis, an

average has been used for the calculation of VOC saving in “with-case” compared with “without-case.”

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Table 14. Average saving in travel time7

Vehicletype Auto Bus Truck Heavy

truck Trailer Average

Per cent oftravel time 26 20 19 17 - 21

(ii) Travel time saving by using bridge instead of ferry transport

There are two locations where ferry service is currently provided on the project road.After completion of the project, the ferry system will be eliminated, and road transportationwill be undertaken through the bridges. Currently, all vehicles have to stop and wait for aferry boat at two locations. Since actual waiting time has not been surveyed, followingassumptions have been made for calculation of travel time saving:

(i). Waiting time for a ferry boat of each vehicle: 1 hour(ii). All the vehicles using a ferry boat currently will use bridges after upgrading of

the project road.

(c) Contribution to regional economic development

The improvement of the road will lead to a reduction in travel time to Dhaka forregional transport and will have a positive impact in GDP. The Padma Bridge ConstructionStudy Report has highlighted the influence of infrastructure development on regionaleconomic development. However, this benefit will not be calculated, under the subjectanalysis.

(d) Reduction of damage to cargo

Cargo damage caused by shocks and jolts, resulting from bad road and shoulderconditions, will be reduced by improving the road surface.

(e) Improved driving comfort

Driving comfort, for both drivers and passengers will be improved as a result of theroad improvement, thus reducing the need to negotiate bad road surface with pot holes,cracks, and other pavement deterioration

For the calculation of travel time saving, time value in Bangladesh has been used.Benefit caused by travel time saving is calculated by multiplying saving time and time valuein Bangladesh. For the purpose of this study, time value in Bangladesh has been estimatedto be about US $ 0.368, using the data of crew wage cost shown in “Vehicle OperatorsSurvey 2004.”

5. Economic cost

In previous section, project cost has been calculated by using market price excludingVAT. Generally all taxes and government subsidies for materials and equipment related tothe project should be deducted from project cost calculated in market price. However, for

7 “Vehicle Operation Survey, 2004” the original table also includes other vehicle types.8 Exchange rate between US $ and Taka: 1.0 US $ = 72 Takas.

27

the purpose of this study, the cost excluding VAT, as mentioned above, will be used aseconomic cost for analysis.

Initial cost for the reconstruction work and change of alignment, and other work hasbeen estimated as US $ 60,210,000 and US $ 34,210,000 for alternative-1 and alternative-2respectively. It is divided into three construction years as below:

Table 15. Allocation of initial costYear Alternative-1 (US $ 1,000) Alternative-2 (US $ 1,000)

2008 20, 070 11,403

2009 20,070 11,403

2010 20,070 11,403

Total 60,210 34,210

Periodic maintenance work (rehabilitation of Asphalt Concrete pavement sections)for the entire section will be done every 10 years, and the cost is calculated as US $2,670,000. The cost of routine maintenance work is estimated in US $ 534,000 (Unit cost:US $ 6,000/km).

6. Result of evaluation

Using the cash flow of cost and benefits, the Internal Rate of Return (IRR), NetPresent Value (NPV), and Benefit Cost Ratio (B/C) have been calculated for alternative-1and alternative-2. With this IRR and B/C calculated here, the viability of the project can bejudged and the scale of social profit can be ascertained from the NPV. The figures for eachindicator are shown in the following table.

Table 16. Result of evaluationIndicator Alternative-1 Alternative-2

IRR 8.6 % 14.4 %B/C 0.73 1.22NPV US $ 3.8 million US $ 16.9 million

Unfortunately, as shown in Table 16, and based on the result of the evaluation,alternative-1 is judged to be unfeasible. Therefore, alternative-2 has been examined forfeasibility. The result of subsequent evaluation establishes that alternative-2 is a morefeasible option.

7. Sensitivity analysis

Project cost and benefit can be changed by estimation errors, unexpectedsocio-economic changes, etc, and hence, a sensitivity analysis was conducted. In thisanalysis, the project cost (initial cost) and benefit (which is mostly influenced by trafficvolume) has been assumed to change within a range of ±10 per cent and ±20 per cent. Asensitivity analysis has been done for alternative-2.

28

Table 17. Result of sensitivity analysis (Alternative-2)BenefitCost Indicator

0% -10% -20%IRR 14.4 13.1 11.7B/C 1.22 1.10 0.970%NPV 16.9 13.2 9.4IRR 13.2 12.0 10.6B/C 1.11 1.00 0.89+10%NPV 14.8 11.1 7.3IRR 12.2 10.9 9.6B/C 1.02 0.91 0.81+20%NPV 12.8 9.0 5.3

Note: IRR: %, NPV: US $ million

According to the result of a sensitivity analysis, alternative-2 will be feasible, evenin case of an increase in cost by 20 per cent. However, it is not feasible in case of areduction of benefits by 20 per cent, and if the cost increases by 20 per cent and benefitreduces by 10 per cent, as shown in Table 17.

8. Other spill-over benefits

Upgrading of Bhatiapara-Jessore-Benapole road through an implementation ofalternative-2, as described above, will bring additional benefits listed below:

(i). Removing the bottleneck section (Dhaka – Benapole) will reinforce theoriginal and intended function of international road (AH1) i.e. to activate andenhance international trade;

(ii). Improvement of road surface will bring more reliable transportation, especiallyfor international cargo, and transportation of agricultural products andconsumer goods from, and to, the areas along the road;

(iii). Reliability of transportation will facilitate more international trade andgenerate higher traffic volume along the project road;

(iv). In accordance with the increase of traffic volume, some service facilities fordrivers such as restaurants, repair shops etc. will be built, and the economyalong the road will be more active;

(v). Rapid access to social facilities such as hospitals, schools, police help etc. willbe realized;

(vi). Easy access to developed cities such as Jessore will help to urbanize new areasfor the residents along the road.

L. Preliminary environmental and social consideration

(a) Environmental Impact

Since the project includes improvement and upgrading of an existing road, and theroad in question does not pass through national reserves and/ or protected areas such asnational parks, no significant negative environmental impact is anticipated from the project.However, any common environmental impact, related to road improvement, should bemonitored and mitigated during construction and operation. The project will have majorpositive impacts in terms of the paved road reducing dust, providing uninterrupted accessthrough construction of the Kalna Bridge and the bypass, and the widening of other bridges.There are large trees along the roadside in Jessore-Benapole section, and hence thewidening and construction work for this are needs to be planned carefully.

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(b) Social Impact

Since resettlement of population is not required in the project, no negative socialimpact is anticipated. However, the construction of the Jhingeracha bypass will necessitatesome land acquisition, so proper compensation should be provided while acquiring the land.This bypass once completed is expected to reduce negative impact of the existing road as itwill avoid the center of Jhingeracha town. On the other hand, the construction will createjob opportunities along the project road, and provide other economic opportunities for thelocal communities, thus contributing to poverty alleviation. It is recommended that anappropriate construction method is adopted, to ensure participation of local residents in theroad project. An improvement of the road will also provide uninterrupted access to healthcentres and educational institutions.

c) Gender Issues

During the site survey, it was observed that both men and women were equallyemployed for the road rehabilitation and maintenance work, and they earned the same wage.They can also expect to receive the same benefit from this development project.

M. Implementation plan

Considering the climate of Bangladesh and the rainy season, a tentativeimplementation plan for the improvement of the project road is proposed below, in Table18.

Table 18. Tentative implementation plan of project road

1st Year 2nd Year 3rd YearWork item

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Reconstruction/improvementof road structure andpavement

- Earth work

- Pavement work

Reconstruction/constructionof bridges

- Substructure

- Superstructure

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IV. CONCLUSION AND RECOMMENDATION

A. Conclusion

According to the results of the engineering analysis and economic evaluation,alternative-2, which includes the construction of a bridge over the Kalna River, and partialreconstruction of road structure between Jessore and Benapole, is judged to be the mostfeasible. While alternative-1, which includes total reconstruction of the road structure in theentire stretch of the project road, is judged unfeasible due to the higher initial costs required.

Since the section between Bhatiapara and Jessore is below the AH Class III standardon AH1, this section needs to be upgraded. Moreover, the project road is expected to be themain link between Dhaka and Benapole border post once the construction of the PadmaBridge is completed. The bridge, when completed, would help to improve internationaltransport along the project road, due to a much shorter distance compared with the existinglink through the Aricha Ferry.

B. Recommendation

Since the project road (AH1) is a very important international transport routeconnecting Bangladesh with India, many heavily loaded trucks are expected to use thissection once the Padma Bridge is constructed. In order to secure a safe and a reliabletransport route, it is recommended that the entire project road is upgraded to meet AH ClassII standards. In this regard, alternative-2 is adjudged as the most appropriate improvementplan from a technical, as well as an economic point of view.

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Annex IAsian Highway classification and design standards

HIGHWAY

CLASSIFICATIONPrimary (4 or more lanes) Class I (4 or more lanes) Class II (2 lanes) Class III (2 lanes)

Terrain classification L R M S L R M S L R M S L R M S

Design speed (km/h) 120 100 80 60 100 80 50 80 60 50 40 60 50 40 30

Width (m) Right of way (50) (40) (40) (30)

Lane 3.50 3.50 3.50 3.00 (3.25)

Shoulder 3.00 2.50 3.00 2.50 2.50 2.00 1.5 (2.0) 0.75 (1.5)

Median strip 4.00 3.00 3.00 2.50 N/A N/A N/A N/A

Min. horizontal curve (m) 520 350 210 115 350 210 80 210 115 80 50 115 80 50 30

Pavement slope (%) 2 2 2 2 - 5

Shoulder slope (%) 3 – 6 3 – 6 3 – 6 3 - 6

Type of pavement Asphalt/cement concrete Asphalt/cement concrete Asphalt/cement concrete Double bituminous treatment

Max. superelevation (%) 10 10 10 10

Max. Vertical grade (%) 4 5 6 7 4 5 6 7 4 5 6 7 4 5 6 7

Structure loading

(minimum)HS20-44 HS20-44 HS20-44 HS20-44

Notes: Figures in parentheses are desirable values.

Minimum radii of horizontal curve should be determined in conjunction with superelevation.

The recommended width of the median can be reduced in restrictive areas with the appropriate type of guard fence.

The Parties should apply their national standards when constructing structures such as bridges, culverts and tunnels along the Asian Highway.

32

Annex II

Cash flow evaluation and result of Alternative-1Year Project cost Time saving VOC saving Cash flow2008 20,070,000 -20,070,0002009 20,070,000 -20,070,0002010 20,070,000 -20,070,0002011 534,000 1,345,336 1,717,037 2,528,3732012 534,000 1,516,817 2,090,107 3,072,9242013 534,000 1,743,925 2,730,768 3,940,6932014 534,000 2,045,900 3,857,317 5,369,2172015 534,000 2,448,940 5,868,049 7,782,9882016 534,000 2,988,882 3,989,804 6,444,6852017 534,000 3,108,984 4,138,860 6,713,8442018 534,000 3,235,386 4,295,402 6,996,7882019 534,000 3,368,429 4,459,836 7,294,2652020 534,000 3,508,475 4,632,591 7,607,0662021 2,670,000 3,655,882 4,813,935 5,799,8172022 534,000 3,811,198 5,004,760 8,281,9582023 534,000 3,974,734 5,205,344 8,646,0792024 534,000 4,146,938 5,416,219 9,029,1572025 534,000 4,328,281 5,637,945 9,432,2262026 534,000 4,518,980 5,870,777 9,855,7572027 534,000 4,720,051 6,115,958 10,302,0092028 534,000 4,931,829 6,373,864 10,771,6932029 534,000 5,154,896 6,645,191 11,266,0872030 534,000 5,389,868 6,930,673 11,786,5412031 2,670,000 5,637,344 7,231,167 10,198,5112032 534,000 5,898,094 7,547,345 12,911,439Total 76,230,000 81,479,169 110,572,948 115,822,117

IRR= 8.6%NPV= 3,840,024B/C= 0.73

33

Annex IIICash flow evaluation and result Alternative-2

Year Project cost Time saving VOC saving Cash flow2008 11,403,000 -11,403,0002009 11,403,000 -11,403,0002010 11,403,000 -11,403,0002011 534,000 1,345,336 1,717,037 2,528,3732012 534,000 1,516,817 2,090,107 3,072,9242013 534,000 1,743,925 2,730,768 3,940,6932014 534,000 2,045,900 3,857,317 5,369,2172015 534,000 2,448,940 5,868,049 7,782,9882016 534,000 2,988,882 3,989,804 6,444,6852017 534,000 3,108,984 4,138,860 6,713,8442018 534,000 3,235,386 4,295,402 6,996,7882019 534,000 3,368,429 4,459,836 7,294,2652020 534,000 3,508,475 4,632,591 7,607,0662021 2,670,000 3,655,882 4,813,935 5,799,8172022 534,000 3,811,198 5,004,760 8,281,9582023 534,000 3,974,734 5,205,344 8,646,0792024 534,000 4,146,938 5,416,219 9,029,1572025 534,000 4,328,281 5,637,945 9,432,2262026 534,000 4,518,980 5,870,777 9,855,7572027 534,000 4,720,051 6,115,958 10,302,0092028 534,000 4,931,829 6,373,864 10,771,6932029 534,000 5,154,896 6,645,191 11,266,0872030 534,000 5,389,868 6,930,673 11,786,5412031 2,670,000 5,637,344 7,231,167 10,198,5112032 534,000 5,898,094 7,547,345 12,911,439Total 50,229,000 81,479,169 110,572,948 141,823,117

IRR= 14.4%NPV= 16,918,303B/C= 1.22

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