Railway research, dev centre: Chinese firm wants joint venture

A Chinese state-run company wants to set up a research and development centre for Bangladesh Railway (BR) in a joint venture with the BR. 

The China Railway Design Corporation (CRDC) submitted a proposal to the railways ministry in January for the establishment of the centre, titled Bangladesh Railway Centre for Research and Development (BRCRD).

If approved by the relevant government authorities, the centre will be jointly funded and operated by the two state-run agencies, and the profit will be shared proportionately, according to the proposal seen by The Daily Star. 

Instructed by the railways ministry, the BR evaluated the proposal and submitted its findings to the ministry last month. Its report said the proposal does not contain cost estimations or any economic and financial analysis. The proposal does not include any supporting studies either, BR sources said.

According to the proposal, the research and development centre would create "a new juncture and handle point" for the development strategies and construction of the 'Belt and Road', which will promote greater cooperation between Dhaka and Beijing. 

China's Belt and Road Initiative, where Bangladesh is a signatory, aims to rediscover the ancient Silk Road for regional integration and to boost trade and economic growth across Asia and Europe.

The Chinese proposal comes at a time when BR is implementing its biggest project yet -- Padma Bridge Rail Link -- with Tk 39,246 crore in Chinese loan.

Two more rail projects were expected to be implemented with Chinese loans. Beijing had even selected two Chinese contractors for these projects.

But both projects are now uncertain. One project stalled after China pulled out from the Joydebpur-Ishwardi double line project "for a lack of in-depth primary work and insufficient feasibility study". The other project meant to expand the Akhaura-Sylhet track is also stalled as the Chinese contractor declined to work after the Bangladesh government revised the cost down.

Different Chinese companies are involved with at least five major railway infrastructure projects, including two fast-track projects -- Padma Bridge Rail Link and Chattogram-Cox's Bazar Rail Link.

CRDC, which proposed to co-build the research and development centre, is the only design enterprise subordinate to China State Railway Group Co Ltd.

It was involved in carrying out the feasibility study and detailed design for the high-speed rail line between Dhaka and Chattogram. The study was completed last year.

THE PROPOSAL

During his China visit on August 26, 2019, Bangladesh Railways Minister Nurul Islam Sujan and Chairman of China State Railway Co Ltd had "reached an important consensus," the proposal said.

"The two sides suggest strengthening the cooperation in railway technology, equipment, construction, operation, training, etc. The Chinese side will provide full support," reads the proposal.

It said establishment of the proposed centre will accelerate the formation of Bangladesh's localised independent technology research and development, improve project management capabilities, reduce dependency on foreign products and services, and thus save foreign reserves.

It can also generate forex income by exporting high-end products and services, it added.

CRDC estimates the center can earn some $187 million per year by providing services, including training, planning, design, project management supervision, quality testing and product sales.

The Chinese company proposed two models for setting up the centre. One is by establishing a separate department within the BR to be staffed jointly by CRDC and BR. The other by launching a joint venture company, also manned jointly by the two state agencies.

As a starter, the centre can be launched with personnel training for the proposed high-speed railway on Dhaka-Chattogram route, it said.

However, the railways minister told The Daily Star in October last year that the government would "go slow" with the high-speed train project due to the cost involved.

"It is proposed that BRCRD be elevated to the level of cooperation between the two governments and that the specification, scale and initial funding of BRCRD be resolved by making full use of the inter-government force," the proposal said.

BR Director General Dhirendra Nath Mazumder did not comment on the proposal, only saying they sent their evaluation report to the ministry.

The rail secretary did not pick up the calls nor respond to text messages requesting his comments.

But sources in the BR said the proposal is not supported by any detailed assessments and lacks details on cost and benefit sharing.

Transport expert Prof Shamsul Hoque said countries around the world have research and development wings in major agencies like railways.

"Unfortunately, we do not have such wings in any agencies, let alone in railway. If we want sustainable development, railways should have such a wing," he told The Daily Star recently.

But the BR has to lead the initiative and the Chinese company can provide necessary support, he added.