Price of delay: Dhaka-Ashulia expressway cost jumps to Tk27,046cr
New project deadline now 2030.
The government has approved a second revision of the Dhaka-Ashulia Elevated Expressway project, increasing its cost by 54% to Tk27,045.67 crore and extending its completion deadline by four years.
The decision was taken at an Executive Committee of the National Economic Council (Ecnec) meeting at the Secretariat today (22 July), chaired by Prime Minister Tarique Rahman. Officials attributed the revision to design changes, new project components, taka depreciation against the US dollar, and previously unaccounted utility relocation and land-related costs.
The revision adds Tk9,492 crore to the project's cost, including Tk3,550 crore in project loans and the rest in government funding, while extending the completion deadline by four years to 2030.
Exchange rate and cost drivers
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The taka's depreciation against the US dollar was the largest driver of the increase. The exchange rate – initially Tk80.57 per dollar, later revised to Tk86 – rose to Tk121.75 in the second revision, pushing remaining contractor payments up by Tk3,736.61 crore, or 39.36% of the total cost increase.
Higher contractor payments also raised Vat and income tax liabilities by Tk1,000.36 crore (10.85%) and customs duties on imported materials by Tk390.73 crore (4.12%).
Design changes
Following directives from the Bangladesh Inland Water Transport Authority reclassifying three branches of the Turag River, bridge vertical clearance was raised from 7.62 metres to at least 12.2 metres and span lengths extended to 90 metres, adding Tk597.66 crore (6.30%).
Expansion of the Dhaka-Tongi railway corridor from two to four tracks, with provision for six in future, required bridge spans of up to 125 metres, adding Tk153.2 crore (1.61%). A new trumpet interchange at Baipail added Tk610.07 crore (6.42%), while raising nearby structures to 18 metres cost Tk166.41 crore, and a ramp linking the airport's third terminal added Tk243.5 crore.
Land acquisition expanded from 10.89 to 14.5 hectares, adding Tk747.55 crore, while previously excluded utility relocation and land rental costs added Tk516 crore.
Project background
The 24-kilometre expressway runs from Kawla, near Hazrat Shahjalal International Airport, through Ashulia to Sreepur in Savar, and is being implemented by the BBA to ease congestion and speed the transport of export goods, particularly garments, to Chittagong Port.
The project originated from a 2015 pre-feasibility study on the Abdullahpur-Baipail route and a January 2015 memorandum of understanding with China National Machinery Import and Export Corporation.
Ecnec approved the original Tk16,901.32 crore project in 2017. The cost was first revised to Tk17,553.04 crore in 2022 before the latest increase. The initial approval was followed by the signing of the construction contract and a loan agreement with China Exim Bank.
Reasons for first revision
BBA officials said the first revision, approved in 2022, stemmed from several factors. While the original plan envisaged 100% foreign-loan financing for the commercial contract, the final agreement capped foreign financing at 85%, leaving the government to cover the remainder.
Three DPP sectors – employer's facilities, the central control building, and boot clearance – were also shifted from foreign-loan financing to government funding.
The dollar exchange rate was raised from Tk80.57 to Tk85.80, and the price contingency rate was also increased.
Though construction-period loan interest fell by Tk11.16 crore, costs rose sharply across the elevated expressway, ramps, the Nabinagar flyover, at-grade roads, bridges, overpasses, utility drains and the toll plaza, while consultancy costs rose by Tk9.59 crore and spending increased on allowances, honorariums, outsourced staff, fuel, stationery and vehicle maintenance.
COVID-19 delayed the start, and construction began on 28 October 2022, with a five-year, two-month construction period and a two-year Defects Liability Period.
The second revision, reviewed at a Project Evaluation Committee meeting on 21 January 2026, extends the deadline to 30 June 2030, including the defects liability period (DLP).
Eight projects approved at Ecnec
Ecnec approved eight projects at the meeting, worth a combined Tk14,041 crore, including the Dhaka-Ashulia proposal, with Tk10,494 crore from government funding and Tk3,550.44 crore from project loans.
The other projects approved by Ecnec include the Universal Social Infrastructure Development-2 (1st revision), the Greater Dinajpur District Integrated Development and Rural Road Maintenance and Employment Project, the Disaster Shelter Construction, Renovation and Development Project (3rd revision), and the Power Distribution System Development Project for Sylhet Division (3rd revision).
The committee also approved the drilling of one appraisal-cum-development well (Begumganj-5) and two exploration wells (Begumganj-6 and Sunetra-2), as well as the upgrading of kidney dialysis centres in medical college hospitals to 50 beds and the establishment of 10-bed dialysis centres in district sadar hospitals (2nd revision).
