No public funded Tourism Complex in Cox's Bazar, says Cabinet Committee

_A Monitor Report1 Jun, 2019 | 313 Views|-+
Dhaka : AHM Mustafa Kamal, Minister of Finance has expressed resentment at the ministry officials, saying that public sector entities have no success in running any tourism project.

The Cabinet Committee on Economic Affairs has rejected a proposal of the Civil Aviation and Tourism Ministry, for construction of a tourism complex in Cox's Bazar at its own initiative and wants the project to be implemented under the public-private partnership (PPP).

The ministry had moved to construct the tourism complex in Cox's Bazar at its own initiative after having failed to implement the project under PPP despite passage of five years, as no company showed interest to link up with it.

AHM Mustafa Kamal, Finance Minister, who presided over the meeting, expressing resentment at the ministry officials, said that public sector entities have no success in running any tourism project.

The minister then advised the Civil Aviation Ministry to implement the project as per the previous decision, if needed, by softening the conditions of the contract.

Account of the project

Bangladesh Parjatan Corporation (BPC) had undertaken a project to turn the Upol Motel Complex, on 5.70 acres of land in Cox's Bazar, into an international hotel complex under the PPP model.

On August 21 in 2014, when the ministry placed the project titled 'Establishment of International Standard Tourism Complex at existing Motel Upol Compound of BPC at Cox's Bazar, ' it received the approval.

Following the approval, PPP appointed Indian consultancy firm Feedback Infra Structure Advisory Services Private Ltd to conduct a feasibility study.

The Indian firm prepared a contract document and the first bid was invited on February 22 in 2017 setting the upfront premium for the project at BDT12 crore, project development fee at BDT5 crore, and annual contract fee at BDT2 crore with provision for 5 percent increase per year. The contract period of the project was set at 50 years.

Orion Power Meghnaghat Limited was the lone bidder in the tender, but the tender evaluation committee considered it to be incompetent.

In such a situation, the PPP authority advised BPC to ease the conditions of the tender, to make the project commercially viable and lucrative for the private investors.

The tender was then invited for the second time on September 28, 2018 where the upfront premium was set at BDT 6 crore, project development fee at BDT4 crore, annual contract fee BDT2 crore, with 3 percent increase per year, and tenure of contract at 25 years with provision for 15-year extension.

Yet, no bidder submitted bids for the project even on the last day of tender submission on November 11, 2018. Finally, the tender submission date was extended till December 11.

The ministry finally decided to withdraw the Upol Motel project from the PPP list.

Also on Bangladesh Monitor