February 26, 2018

ADB to finance Bangladesh Railways fleet modernisation

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ADB to finance Bangladesh Railways fleet modernisation MissRuby/Shutterstock.com

THE board of the Asian Development Bank has approved a $US 360m loan for Bangladesh Railways (BR) to finance the modernisation of the company’s locomotive and rolling stock fleet.

BR plans to acquire 40 new broad-gauge locomotives, 125 luggage vans and 1000 freight wagons by the end of June 2022. The total cost of the project is $US 453.4m, with the Bangladeshi government set to contribute $US 93.4m.

The procurement will include the introduction of auxiliary power units (APUs) to reduce diesel consumption when idling.

The loan is accompanied by a $US 500,000 technical assistance grant, which is being funded by the Asian Clean Energy Fund, to develop a training scheme for drivers as part of the APU rollout, and recommends potential approaches to improve overall energy efficiency.

ADB says modernisation of the fleet and maintenance facilities will help to meet the government’s target of increasing rail’s market share to 15% in freight and 10% in passenger by 2020.

“Railways in Bangladesh potentially offer a cheaper, safer, and more fuel-efficient means of transport of goods and passengers than roads, but have been held back by lack of investment and aging and unreliable rolling stock,” says ADB senior transport specialist Mr Tsuneyuki Sakai. “The ADB Railway Rolling Stock Operations Improvement Project will boost the operational performance of Bangladesh Railway by introducing new technology, equipment, and processes that will be cleaner and more efficient, cutting carbon dioxide emissions.”

Since 2006 the ADB has provided the Bangladeshi government with four loans worth a total of $US 2.81bn to finance railway development.

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