Connecting Regions of Asia.

India Looses Out On Bangladesh Railway Upgrade Orders


An Indo-Japanese joint venture(JV)  initiative recently winning a $500 million (Rs 31.9 billion)  lump sum contract in the construction of the Dhaka Metro  has brought justifiable satisfaction among Indian Railways  officials. Such news  allays  recent  fears expressed in some quarters  as to whether such a bilateral effort involving India and Japan  to  help   a third country  would   be acceptable to Bangladesh .
  There was good reason for  the  scepticism.  The initial public reaction to   a bilateral offer   for technical expertise/ assistance for  a rapid transit project  was   negative in Dhaka. Bangladeshi  media analysts as well as experts  put off by  the whiff of a  perceived   patronization in the JV proposal. Both India and Japan are already engaged in a number of  ongoing projects  not just restricted to the development of Railways in Bangladesh . Naturally,  the rationale behind  a JV initiatives was questioned.  ‘ There is no reason why we cannot   take our own decisions  and   work out, if necessary,   separate arrangements with these countries  for our   infra   development  projects,’ was the general opinion.
The question arose after an announcement made  some time ago  by India’s Foreign Minister S. Jaishankar  wherein he  articulated the JV   concept.  The   urgency behind the idea  was more marked in  India than  in Japan. Delhi has been  increasingly concerned  about the growing Chinese financial / technical outreach to accelerate  the economic development of its next door neighbour, Bangladesh.  Thanks to their ongoing international Belt and Road Initiative (BRI) , the Chinese have established themselves as the world’s leading driver in implementing infra related projects. More worryingly for India,  China’s  greater financial clout makes it very  hard for Delhi to keep up with Beijing  in securing work orders abroad, even in its  backyard.  
As for Japan, it is not handicapped   financially vis-à-vis China . But the smaller size  of its otherwise  advanced economy  forces it to  decide its involvement in  foreign projects  with much  circumspection . guided also  by  long term strategy— not that an occasional collaboration with  a friendly ally such as India would  hurt its  financial/diplomatic interests.
Of late India has been going all out to deepen  its engagement with Bangladesh in its massive infrastructure development programmes. A new railway link, connecting Haldibari in North Bengal to  Chilahati in Bangladesh is to  be operative, after a break of  55 years.  This will be followed by the proposed direct  railway link between Dhaka and Siliguri, which would enable Bangladeshis to travel to Darjeeling and Sikkim  more comfortably , also saving time.
Such linkages are paying dividends even in the short term.  Bangladesh has begun a  new parcel service  by rail from India. Even during the covid 19 pandemic, India sent  103 freight trains to Bangladesh, carrying sugar,onions, ginger, chilies,maize, turmeric as well as a load of some finished goods.          
Apart from helping Bangladesh Railways  in laying down new broad gauge and other lines, installing signalling and other equipment , providing it with improved rolling stock, India recently gave  10 broad gauge locomotives to Bangladesh.    
Unfortunately, these were not exactly brand new, having been in service for five/six years. . The gift,  an outcome of   talks held earlier between Prime Ministers  of the two countries, led to caustic comments in Bangladesh. Once more, an apparently well intended diplomatic overture had gone  awry , contrary to   prevailing  perceptions  among Indian policymakers.   
The fact is Bangladeshis  are willing to shell out funds for any stuff they order  from abroad, whether by bilateral  agreements or incurring loans. Naturally they prefer buying new items rather than accepting anything second best, even as  gifts !   Embarrassed Indian officials informally clarified to Bangladesh authorities that  Dhaka had been aware that the engines  to be sent  would NOT necessarily be new, as per official discussions. But the matter left a sour taste among the people .
Even as Larsen and Toubro and Marubeni companies of India and Japan respectively   celebrated their success in securing a work order for the Dhaka Metro construction, the  prospect  for Indian companies/Railways  for securing more business do not look promising at all. 
During 2017-19, the following are some of the work orders secured by international companies for modernizing Bangladesh Railways , at different times .
Dhaka has ordered 150 new coaches from South Korea, costing $77.7 million;  20 new diesel electric locos from Hyundai for $80.5 million;70  diesel/electric locos from Hyundai cost $239 million; completed   a  $6 billion deal with China for completing the Padma rail link project; 200 coaches ordered from Indonesian company, cost $71 million.
The Asian development Bank advanced in 2018 a $360 million loan to upgrading/modernising locomotives/rolling stock in  Bangladesh.
While India’s efforts to increase and deepen its   involvement and help to assist its  Eastern neighbour  in its infra development are welcome, Delhi has a long way to go even to   catch up with other countries taking interest     in  engaging with  Bangladesh.

Get real time updates directly on you device, subscribe now.

Leave A Reply

Your email address will not be published.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More