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An economic analysis of the proposed Dhaka–Chittagong Expressway in Bangladesh with the viewpoint of GHG emission reduction

Md. Zia Uddin () and Takeshi Mizunoya ()
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Md. Zia Uddin: University of Tsukuba
Takeshi Mizunoya: University of Tsukuba

Asia-Pacific Journal of Regional Science, 2020, vol. 4, issue 2, No 1, 285-314

Abstract: Abstract Frequent road intersections in Dhaka–Chittagong National Highway (NH1), the major transport corridor of Bangladesh, significantly reduce the level of service of the corridor and eventually leads to inefficient fuel economy and excessive greenhouse gas (GHG) emission. In spite of upgrading NH1 into a four-lane highway, major road intersections reduce vehicle speed and increase congestion time and eventually burn fuel. Fuel expenses during this lost time cover no distance but increase vehicular emission within the vicinity of road and contribute to roadside temperature. Besides, the transport sector’s energy demand in Bangladesh is supported mostly by imported fuel that drains out foreign currency and inhibits GDP growth. Against the backdrop, the Government of Bangladesh is proposing to construct a four-lane expressway. The paper attempts to estimate the fuel loss savings, GHG emission reduction and economic benefit of constructing Dhaka–Chittagong Expressway. As the construction of the expressway paved a way for an increment of traffic growth by 10%, the study infers that the average lost time because of 36 intersections for a projected annual average daily traffic of 27,334 vehicles/day (in 2022). In addition to that, the fuel loss savings for various vehicle classes affect economic growth and the ensuing idling emission of EFI and MFI engines contributes to transport sector pollution. The study intends to expedite the fact that Dhaka–Chittagong Expressway would not only replace road interventions that reduce travel time cost, expenditures regarding vehicle operating and accident but also contributes cardinally to economic emancipation of the country. The estimated Benefit–Cost Ratio (BCR) was 1.23, net present value was 762.34 Million USD) and Economic Internal Rate of return was 18.27% of the proposed project.

Keywords: Fuel consumption; Greenhouse gas emission; Vehicle operating cost; Travel time cost; Cost–benefit analysis; Expressway construction (search for similar items in EconPapers)
JEL-codes: Q51 Q58 R41 R42 (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1007/s41685-019-00136-5

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Handle: RePEc:spr:apjors:v:4:y:2020:i:2:d:10.1007_s41685-019-00136-5