Railways in Bangladesh potentially offer a cheaper, safer, and more fuel-efficient means of transporting goods and passengers than roads. Credit: Asian Development Bank.

The Asian Development Bank (ADB) has approved a $360m loan to Bangladesh Railway, which will be used to purchase new rolling stock and strengthen the country’s railway network.

The loan will finance the procurement of 40 broad gauge locomotives, 125 luggage vans and 1,000 wagons for freight trains.

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ADB noted that the new rolling stock will introduce auxiliary power units (APU) to Bangladesh Railway in a bid to reduce diesel consumption when the locomotives are standing idle.

The amount is also expected to be used to refurbish maintenance facilities and establish training programmes for drivers, as well as run the network’s enterprise-wide IT system.

"The ADB Railway Rolling Stock Operations Improvement Project will boost the operational performance of Bangladesh Railway by introducing new technology, equipment and processes."

These initiatives require a total combined investment of $453.37m, including $93.37m that is set to be provided by the government.

All the outlined projects are slated to be completed around the end of June 2022.

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The market share of railways as an alternative method of transport has recently dropped in Bangladesh due to inadequate investment in infrastructure and rolling stock.

The majority of the rolling stock in the country is noted to be 30 years old and the maintenance facilities have not been sufficiently overhauled over time.

ADB senior transport specialist Tsuneyuki Sakai said: “Railways in Bangladesh potentially offer a cheaper, safer, and more fuel-efficient means of transport of goods and passengers than roads, but have been held back by lack of investment and aging and unreliable rolling stock.

“The ADB Railway Rolling Stock Operations Improvement Project will boost the operational performance of Bangladesh Railway by introducing new technology, equipment and processes that will be cleaner and more efficient, cutting carbon dioxide emissions.”

The government has also placed additional emphasis on railway development as part of its seventh five-year plan for 2016-2020, which aims to improve the railway market share to 15% in freight transport and 10% in passenger movements by 2020.

ADB has provided four loans to Bangladesh for railway development since 2006, amounting to a total sum of $2.81bn.