Western Bangladesh can become a transit hub in South Asia

Bangladesh is often mooted as a regional logistics and transit hub and a bridge between South and Southeast Asia. Now, this ambition may become a reality in the country’s western region , which shares a border of over 2,000 kilometers with India and is home to major sea and land ports such as Mongla, Payra, Benapole, and Bhomra. 

The upgrade of a 260 km highway from Bhomra in the southwestern corner of Bangladesh to Hatikumrul will turn an old two-lane single carriageway into a state-of-the-art and climate-resilient four-lane dual carriageway.

While large transport corridors can pave the way to greater prosperity, achieving their full economic potential requires complementary interventions.  To that end, secondary and tertiary roads and logistics infrastructure such as storage and packaging facilities and collection points will be built to stimulate the local economy along the corridor.

Through the Government of Bangladesh’s Western Economic Corridor and Regional Enhancement (WeCARE) program, supported by the World Bank and Asian Infrastructure Investment Bank, improved roads will crisscross ten districts of over 20 million people and benefit consumers and local communities, especially small and medium-size farmers and enterprises who suffer from poor transport and weak logistics. The project is also supported by the South Asia Regional Trade Facilitation Program.

The upgrade of a 260 km highway will turn an old two-lane single carriageway into a state-of-the-art and climate-resilient four-lane dual carriageway.

By linking up businesses and consumers, boosting trade and consumption, and eventually generating higher income and new jobs, the refurbished highway will bring a welcome economic boost to western Bangladesh , which lags the rest of the country. Since 2010, poverty has remained high in western Bangladesh while declining in the central and eastern divisions; consumption growth is also significantly lower than in other parts of Bangladesh.

Mussama Sajida Begum, a flower cultivator in Jashore is one of many who will benefit from easier access to markets as she will be better connected to markets and will be able to make more informed decisions. “We don’t know the market price. The middleman buys from us and sells at the market,” she says. “It is only later that we find out that the price is higher, but we sold at a lower rate. That is how we suffer.”

Highway road users will also experience better safety as separate service lanes for slow-moving vehicles, and vulnerable users will be built on both sides of the corridor.  Optical fiber cables will be deployed along the corridor to enhance digital connectivity and support “smart” systems such as the Intelligent Transport System (ITS) to improve emergency response and business continuity—which have become priorities as Bangladesh faces COVID-19 threats.

The refurbished highway will bring a welcome economic boost to western Bangladesh

As COVID-19 has further stressed supply chains for food and other essential goods, the benefits of reduced logistics costs and losses during transportation after harvest are expected to be significant. 

The program will also prioritize less developed areas and vulnerable people, such as women, to ensure they benefit from the corridor.

In the first phase of the program, World Bank is providing $500 million to the Government of Bangladesh to support the construction of a 48 km national highway from Jashore to Jhenaidah, 600 km of connecting village, Upazila and Union roads, and around 32 markets, involving storage, grading, sorting, packaging, collecting and selling facilities for selected agriculture value chains. 

This initial investment will also help create jobs and support economic recovery after COVID-19 pandemic, especially for the most vulnerable who often work as manual laborers . Labor-intensive civil works will generate around 1.3 million days of rural employment in the first 24 months.

As COVID-19 has further stressed supply chains for food and other essential goods, the benefits of reduced logistics costs and losses during transportation after harvest are expected to be significant.

Last, WeCARE will help Bangladesh’s western region take full advantage of its strategic geographical as a gateway to Bhutan, Nepal, and India.  The corridor will facilitate cross-border movement and trade in the Benapole and Bhomra land ports, which are the two most-used border crossing points between Bangladesh and India.  

Greater connectivity will tremendously benefit Bangladesh, enabling it to trade in transport services, and earn port and road transport charges as well as transit fees  and help the country become a regional logistics and transit hub in South Asia.