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“BANGLADESH Railway Infrastructure”

Independent University, Bangladesh

Submitted to

Dr. Rezai Karim Khondker Faculty of Macro Economics (MBA 510, Sec-02)

School of Business

Independent University, Bangladesh

Submitted by

Farabi Ahmed

ID: 121-121-8

Date of Submission: 29th March, 2015

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Letter of Transmittal

29th

March, 2015.

Dr. Rezai Karim Khondker

Macro Economics (MBA 510, Sec-02)

Faculty Member of School of Business,

Independent University Bangladesh.

Subject: A report on Bangladesh Railway Infrastructure.

Dear Sir,

With due respect, I would like to inform you that I have completed report on “Bangladesh

Railway Infrastructure”. It is immense pleasure for me because I have successfully completed

this report by receiving your continues guideline as a supervisor.

I have endeavored to prepare this report from my level of best to accumulate relevant &

insightful information. If I am included any wrong information in unconsciously so please

forgive me as your student. It is a great experience for me to make this report. I have tried to

make the report comprehensively within the schedule time & limited recourse.

You’re sincerely

………………………

Farabi Ahmed

ID: 121-121-8

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Table of Contents

Subject Page No

Introduction

4

Objective of the study

5

Overall activities of Bangladesh Railway from 06-11

5

Projected Expenditure by

Department/Agencies/Operational Units from 2013-

2019

8

Issues of Bangladesh Railway

8

Recommendation

9

Conclusion

9

References

10

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Introduction

Rail communication has traditionally been the main mode of mass transport for both

commercial and cargo usage dating back to the British rule. With wider connectivity and more

efficient technology, rail communication is considered to be environment-friendly, comfortable

and affordable in the densely populated country like Bangladesh, it is a very important form of

transport as it costs relatively lower among the different form of transport communication.

Bangladesh Railway has around 2877 kilometer of railway network which connects 44 District

and almost all the important places of the country and has a great contribution in accelerating the

economic activities. In the fiscal year 2012-13, around 44 investment and TA projects have been

implementing to make the rail network safe, easier and faster. Under these projects renovation of

existing railways, purchase of locomotives, wagons and new coaches and modernization of

signaling system is being going on. These types of infrastructure development will to ease traffic

congestion of the capital. It will also increase the quality of railway transportation. Ministry of

Railway is continuing its effort to maintain a safe and cost effective communication system

which will ultimately ensure a high economic growth and a balanced economic development of

the country. National and international connections such as Trans Asian Rail Network, SAARC

and other network will be established through these development activities. Bangladesh Railway

is performing all the activities including carrying of passengers and goods under the newly

established Ministry of Railways. Based on the allocation of business, the functions of the

Ministry include Policy formulation, monitoring and evaluation of policies relating to railways

and rail transport; development, expansion and maintenance of railway related systems;

Coordination of national and international railway systems; formulation and implementation of

security policies relating to railway transportation etc. Bangladesh Railway is continuing its

endeavor for the development of a modern, integrated, sustainable, safer and quality

communication system which leads to socio-economic development of the country. In the Sixth

Five Year Plan and Outline Perspective Plan of Bangladesh, priority has been put on the

development of the easy and safe rail infrastructure among all other transport communication to

ensure employment and poverty alleviation. For this reason, Ministry of Railways has selected

its own priority based on the policy and strategy documents which targets renovation and

modernization of rail infrastructure, easing the internal and international rail communication etc.

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Though gender related matters are not clearly mentioned in the documents such as National Rail

Transport Policy, citizen charters, Railway Master Plan, pro-women steps remain in the activities

of this Ministry.

Objective of the study

Show the budget and analyze it.

Show revenue and expensed over the years and analyze the deficit amount.

Show infrastructure problem and give some recommendation based on it.

Overall activities of Bangladesh Railway from 06-11

Bangladesh Railway is one of the oldest service-oriented organizations which provides,

environment-friendly, less hazardous and less expensive transport services. BR has got a total

network of 2,835.04-route kilometer (Broad Gauge 659.33 km, Dual Gauge 374.83 km and

Meter Gauge-1,800.88 km). After the construction of railway tracks over the Bangabandhu

Bridge, railway link between East and West Zone has been established. The overall activities of

Bangladesh Railway from FY 2006-07 to FY2011-12 are presented in table1.

Table 1

Fiscal Year Revenues

earnings

(corer tk)

Revenue

expense

(corer tk)

2006-07 444.27 814.73

2007-08 452.76 933.13

2008-09 561.64 1088.55

2009-10 625.35 1172.74

2010-11 566.30 1257.20

2011-12 629.55 1305.40

(Source: mof.gov.bd/en/budget/13_14/ber/en/chapter-11_en.pdf, chapter 11 – transport and

communication)

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Analysis of data table 1:

If we look at table 1 then we can see the expenses are more than revenue every year so for this

the government has to make a huge budget on this sector like if we look at the table then we can

see there is minimum deficit of 400 corer taka in 2006-07, 500 corer tk in 2007-08, 500 corer tk

in 08-09, 500 corer tk in 09-10, 600 corer tk in 10-11 and near about 650 corer tk in 11-12. So

budget of BRM is increasing over the years.

Presentation of BRM revised budget and budget from 2012-14

Table 2

(Taka in thousands)

Financial Year Non-Dev Development Total Revenue Capital

2011-12 Revised

Budget

1624,84,59 2265,66,00 3890,50,59 1723,27,44 2167,23,15

2012-13 Revised

Budget

1681,00,00 3021,69,00 4702,69,00 1808,34,10 2894,34,90

2013-14 Budget 1802,78,00 3878,06,00 5680,84,00 2142,07,49 3538,76,51

(Source: www.mof.gov.bd/en/budget/13_14/cdg/en/51_railway_en.pd; Bangladesh Railway)

0

500

1000

1500

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12

Revenue Expense trend of BRM over the years

2006-07

2007-08

2008-09

2009-10

2010-11

2011-12

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We have drawn the table based on table 2

Analysis of table 2

If we look at the table then we can say the revenue is lower than the capital so every year

government has to invest more and more. And the capital spending is increasing day by day

because the government is increasing the facilities and root of the railway.

In FY 2013-14, the following important activities/projects/programmers are scheduled to be

implemented:

Procurement of BG Diesel Electric Locomotive;

Rehabilitation of 200 MG and 60BG passenger coaches;

Procurement of 11 MG Locomotives;

Modernization of Syedpur Railway Workshop;

Rehabilitation of Mymenshing-Jamalpur-Dewangong section line;

Procurement of 220 MG Flat Boggy Wagon;

Procurement of 89 MG Boggy Tank Wagon;

Procurement of 165 BG Boggy Oil Tank Wagon;

Procurement of 20 Set Diesel Electric Multiple Unit (DEMU) for Bangladesh Railway;

Procurement of 70 BG AC coach for Bangladesh Railway; and

The Contraction of third and fourth dual gauge line with signaling in Dhaka-Tongi

Section and dual gauge double line in Tongi-Joydebpur Section etc.

0

1000

2000

3000

4000

5000

6000

2011-12 2012-13 2013-14

Total Budget

2011-12

2012-13

2013-14

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Projected Expenditure by Department/Agencies/Operational Units from 2013-

2019

Table no 3 will show how the projected expenditure meet the actual budget in 2013 and 14 and

there will be some projection from 2015 – 2018

Table 3

(Taka in thousands)

Description Projection

2014-15 2015-16 2016-17 2017-18

Secretariat 230,93,00 2627,58,98 4930,55,01 5553,41,99

Railway

Operations

5803,89,00 4071,05,02 2504,95,99 2700,00,01

Grand

Total :

6034,82,00 6698,64,00 7435,51,00 8253,42,00

(Source: www.mof.gov.bd/.../MBF_51_Ministry%20of%20Railways_%20English... - Grant No –

46 51 - Ministry of Railways)

Analysis of table 3:

If we look at this table we can sat the projected expenditure of BRM is increasing day by day

because our government is want to improve the rail service and try to spread out this service all

over Bangladesh. The table is showing the increase of expenditure in core of taka.

Issues of Bangladesh Railway

Inherited physical problems: BR inherited a number of structural and physical weaknesses as a

part of its legacy, since it was not specially designed and constructed to serve Bangladesh.

Presently there are a number of missing links for direct through traffic.

Gauge problems: Bangladesh Railway has been suffering from various operating bottlenecks.

The railway system comprises two gauges, BG & MG, which involves transshipments of traffic

at the break of gauge points. Recently, Dual Gauge (DG) has been constructed in some important

sections to ease the problems.

Geographical constraints: Rail transportation is very much attractive for long distance

uninterrupted route network. But Bangladesh, a small county of only 1, 55,598 square

kilometers, is a land of rivers. Hundreds of rivers are flowing over the territory. Before

constructing JMB, the underdeveloped northern part of the country was truncated from eastern

part i.e. from the capital city of the country. Recently the through traffic has been plying over

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JMB although JMB Railway Project has not yet been completed for BG trains. Presently there is

no direct rail-route connection of the city to the Southern part of the country. Transshipments are

also involved at reverie points. Besides, during rainy season direct route links are often disrupted

in many points.

Managerial Problems: Bangladesh Railway management system is under experiment for a long

time. Till June 2, 1982, the management and development of railway was vested with a Railway

Board, comprising of a Chairman and four members. But, for administrative convenience and

operational reason the Railway Board was abolished with effect from June 3, 1982 and the

function of the Railway Board was vested with the Railway Division of the Ministry of

Communications with the Secretary of the Division working of as the Director General of

Bangladesh Railway. For the same purpose the Railway bifurcated into two zones, East & West,

under the administrative control of two General Managers (GMs), who are responsible/

accountable to the Director General (DG) of Bangladesh Railway. Subsequently on August 12,

1995, Railway was separated from the Ministry and entrusted with Director General drawn from

the Railway professionals. For policy guidance, a 9 (nine) member Bangladesh Railway

Authority (BRA) was formed with the Minster of Communications as its Chairman.

Recommendations

Modernization of railways: as we see in the table that the capital spending is increasing so

government should invest more to buy the modern equipment for railway and rail line like

foreign countries. Increase service by capturing more location: BRM should invest more to establishing gauge

on the various location of Bangladesh. By doing this the revenue will be increase and service

will be increased.

Political Unrest: Political unrest is also a problem from BRM because if we see there are many

bogies got burned during the strikes or blockades. Political unrest could not include in Rail

traffic.

Managerial coordination: Managerial coordination is needed to work fast in the critical

situation so the power should be decentralized by the zonal heads because we can see many

problems in the special even like EID or PUJA.

Conclusion

Bangladesh Railway is continuing its endeavor for the development of a modern, integrated,

sustainable, safer and quality communication system which leads to socio-economic

development of the country. Bangladesh railway is a promising sector which can improve

people’s transportation and make the peoples life easier. So our government should concentrate

more on this ministry and make a systematic way to improve it day by day.

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References

Islam.S.M…Nasir.E, (May,2014), BANGLADESH RAILWAY MATERIALS CASE STUDY,

retrieved from: https://www.academia.edu/8326131/Railway_Materials_Case_Study

Chapter 11 – transport and communication, : mof.gov.bd/en/budget/13_14/ber/en/chapter-

11_en.pdff

Bangladesh Railway, www.mof.gov.bd/en/budget/13_14/cdg/en/51_railway_en.pd

Chapter 36 Ministry of Railways 1.0 Introduction,

www.mof.gov.bd/.../36%20Chapter%2039_51_Railway_English.pdf

Chapter - 27: Ministry of Railways,

www.mof.gov.bd/en/budget/14_15/.../26_51_Railway_English.pdf

51 - Ministry of Railways,

www.mof.gov.bd/.../MBF_51_Ministry%20of%20Railways_%20English... - Grant No – 46 51

Rahman.S.M, (Aug,2006), RE-ORIENTATION OF BANGLADESH RAILWAY:A MARKET

INTEGRATION STUDY(PDF)