Project Management

Dr. Md. Rakibul Hoque

University of Dhaka
 Project Classifications in
Bangladesh
 Government of Bangladesh has set up certain
regulations for the processing of development
projects. The central organization for the
development planning is the standing Planning
Commission (PC). The projects are divided on
the basis of mainly 3 different criteria, which are-
 Criterion 1- Magnitude of Investment
 Criterion 2- Project Benefits
 Criterion 3- Priority
Project Classification Matrix
in Bangladesh
Criterion 1- Magnitude of
Investment
 Criterion 2 - Project Benefits

For evaluating projects one needs as much as

possible a candid picture of project benefits.
Some projects have easily measurable outputs
and the others have a comparatively difficult
measurability of outputs. This can cause a
dilemma to any project evaluator at a national
level, when different projects compete for scarce
resources. The projects have a varying degree of
score on the social cost-benefit evaluation scale.
 Criterion 2 - Project Benefits
 Projects have been categorized for these reasons
into following different types:
 Type "X" Self-sustaining projects i.e. projects
which earn revenue through sale of output (goods
and/or services). These may also be called directly
productive projects. Notable examples of this type
of projects are projects in the industry sector. It is
to be noted that even such projects may include
indirect and intangible benefits.
 
 Criterion 2 - Project Benefits
 Type "Y" Productive but non-revenue
earning projects i.e. projects which give rise to
tangible output, benefit of which do not accrue
directly to projects themselves but to other
parties. Notable examples are irrigation projects.
 Type "Z" Service sector projects i.e. projects
which do not give rise to tangible output but
provide service benefits to the society e.g.
educational institutions, hospitals etc.
 Criterion 3 – Priority

 In allocation of resources, some projects are

given a higher priority than the others based
upon their importance for the country. Further
some projects are considered to belong to the
core of the development process i.e. has a major
linkage value regarding the viability of other
projects depending upon it e.g. infrastructural,
power sector and projects producing primary
products.
 Criterion 3 – Priority

Apart from the vertical integration of core projects other

points considered for classifying a project as a "core project"
are following:
Only "approved", "revised unapproved" and "PEC recommended"
projects.
Adequate availability of foreign and local funds.

Project nearing completion

"X" type and infrastructural development projects

shorter gestation period

foreign aided projects

 
 Criterion 3 – Priority
The Government of Bangladesh has divided the
projects into two classes based upon this criterion:
 Core projects
 Non-core projects
Number of core projects in 1987/88 was 172 out of
850 projects. The investment size of these projects is
about 65 %. Core projects have a higher priority in the
allocation of Taka resources. These are marked with *
in the ADP.
 
 Criterion 3 – Priority

Some of the benefits for a project to be classed as

core project are: 
No reference is necessary to be made to
Programming Commission and the disbursement is
so called "automatic".
Procurement of project transport vehicles is easier.

System of credit note allowed by NBR for Core

projects are decided by the Programming
Committee meetings.
 Other Classifications
 Apart from the above main three classifications,
different governmental organizations classify the
projects on the basis of other criteria. For example:
 Lately GoB has classed projects as Nationally
Important Projects (NIP) and non-NIP projects. The
classification is based upon: 
 Largeness of projects (category 'C').
 Projects requiring inter-ministerial monitoring and therefore
reporting to ECNEC.
 Projects facing problems and considered to make national level
impact.
 Other Classifications
 External Resources Division (ERD)
categorizes the project on the basis of source
of aid e.g. World Bank, ADB, UNDP, SIDA,
CIDA, NORAD, FRG, DANIDA, SAUDIAID.
JAPANESE AID, US AID etc.
 Planning Commission distributes the projects
under the various sectors of the society e.g.
social, educational, population control,
industrial, energy, agricultural etc.
 Other Classifications

 Ministries divide their projects over the

divisions, departments, bureaus, corporations
and other executive agencies.
 Different corporations subdivide into different
product sectors.
 IMED sub-divides the projects also on the basis
of approval and implementation stages, on
geographical locations and ministry/division and
agency-wise.
 Project Processing
Procedures in Bangladesh

01. Institutional Interaction

02. Project Formulation
03. Project Appraisal
04. Project Approval (investment Projects)
05. Empirical Extracts
06. Project Implementation Start
07.Projects Unapproved in the Plan/ Programme
08. Role of Local Agents
 Project Processing
Procedures in Bangladesh
01. Institutional Interaction
Processing of projects has been planned to be
different for different categories of projects by
Government of Bangladesh. The planned
provisions have already been made for the
project processing procedures of category 'A', 'B'
and 'C' projects. Mainly the following
organizations and bodies are involved in the
kinds of projects under study -
 Project Processing
Procedures in Bangladesh
Managements of various projects
Management of owner companies

Various corporations and Executing Agencies in

Bangladesh
Ministries

Departmental project evaluation committees

Various Sector Divisions and planning division of

Planning Commission (PC)
Project Evaluation Committee (PEC)
 Project Processing
Procedures in Bangladesh

Implementation, Monitoring and Evaluation

Division (IMED)
Ministry of Planning (MoP)

Ministry of Finance (MoF)

External Resources Division (ERD)

Executive Committee of National Economic

Council (ECNEC).
National Economic Council (NEC) etc. 
 Project Processing
Procedures in Bangladesh

 02. Project Formulation : Following steps are

taken in the project formulation stage:
 Project identification
 Check plan provisions and sectoral allocations
 Feasibility study, if required
 Determination of the necessity of foreign aid, if
any.
 Project Processing
Procedures in Bangladesh

 Project preparation by the Agency e

Approval of the project by the Head of
the Agency
 Forwarding of the PP by the Agency to
the Line Ministry where it is handled
by the respective Planning Cells.
 Project Processing
Procedures in Bangladesh
 The planning cells of the ministry are
supposed to examine the project proformas
from the following angles:
 Financial viability
 Economic viability
 Conformity to the ministerial policies
 The cells look into the (social) cost-benefit
from pay-off and internal rate of return (IRR)
etc. techniques.
 Project Processing
Procedures in Bangladesh

 03. Project Appraisal : Steps taken during

the project appraisal stage are as follows: 
 On receipt of project proposal on a Project
Proforma (PP) from the Agency, the
Planning Cell of the Ministry examines the
project in the' context of the sectoral targets,
allocations, priority, technical, economic and
financial viability etc.
 Project Processing
Procedures in Bangladesh
 If the investment cost of the project is more
than Tk. 20 millions the Ministry sends the PP
to the concerned Sector Division of the
Planning Commission for further processing.
 The Sector Division of the Planning
Commission examines the following aspects
of the Project:
 whether the project promises desired contribution
for achieving sectoral targets.
 Project Processing
Procedures in Bangladesh

 economic benefit in terms of employment

generation, production increase etc.
 financial viability
 technical feasibility
 likely availability of external resources
 equipment, accommodation and other cost
 benefit/cost ratio, internal rate of return etc.
if applicable
 Project Processing
Procedures in Bangladesh
On examination and when required, after discussion
with Ministry, if the project is found acceptable, the
Sector Division sends the PP back to the Ministry
for required modification in the size and shape of
the project. If the projects needs no modification or
on receipt of the modified project, Planning
Commission circulates the PP to all Members of the
PEC for their comments/views. After receiving their
comments, the Planning Commission places the
project in the PEC meeting for its consideration.
 Project Processing
Procedures in Bangladesh

 04. Project Approval (investment Projects)

A project costing less than Tk. 20 million crore is
approved by the Ministry concerned. A project
costing between Tk. 20 to 50 million is
examined by the PEC in the Planning
Commission and if, after scrutiny, the PEC
finds the project, acceptable, it recommends
the project for approval of the Minister for
Planning.
 Project Processing
Procedures in Bangladesh
If the investment cost of the project is more than Tk.
50 million the PEC recommends the project for
approval of the ECNEC. In case of necessity for
modification of the project or any of its components,
the PEC recommends to the appropriate authorities
for approval subject to certain changes in the PP.
The PP, recast in line with the decision of the PEC,
is placed before the competent authorities for
approval.
 
Project Approval Ministry
 Project Processing
Procedures in Bangladesh
 05. Empirical Extracts: Attempts have been made to
enforce fixed allocated days for every step. Processing
and approval of "A" category projects shall take
highest 67 days from the approval of project in the
Board of the Agency to notification of the approval by
the Ministry. For "C" type projects, where substantial
revision of PP is necessary for resubmission to PEC,
maximum 187 days are allowable from the day of its
first formulation. In practice almost every step takes a
much longer duration.
 Project Processing
Procedures in Bangladesh
 06. Project Implementation Start: The
projects are executed by the executing
agencies under the control, supervision and
support of the administrative Ministry.
Depending on its priority and recommendation
from the Programming Committee and
clearance from the appropriate authority a
project may be included in ADP before or
after its approval.
 Project Processing
Procedures in Bangladesh
07. Projects Unapproved in the Plan/Programme
Project proposals outside those mentioned in the
five year plan face considerable greater resistance,
not to say impossible, but the systems need to have
some flexibility to this extent for meeting important
unforeseen situations. Sometimes ADP allocations
are made even when there is no provision in the
national plan in light of the importance of a project.
 Project Processing
Procedures in Bangladesh
 08. Role of Local Agents
 Some of the country's smartest persons, with a
marked ability to come into contact with foreign
personnel and companies, operate as agents
of the foreign organizations on commission
basis. It is often emphasized that these agents
influence and hasten the decision making in
both positive and negative way.
 Project Processing
Procedures in Bangladesh
 In 1982 GoB announced its ‘Essential Drugs
Policy. Before that out of 4340 registered
products 1740 were foreign brands. Eight
international pharmaceutical companies held
75% of share. As a consequence of the
above the local foreign companies were made
to compete in essential drugs - an area where
profitability was low. 150 drugs were selected
as essential drugs.
 Project Processing
Procedures in Bangladesh
 The new drug policy caused a great reaction
from multinationals and some western
embassies. Not that Bangladesh had a great
market share but the fear of the precedent it
might unleash in the other third world countries.
 The effects of the policy were :
 Share of local production of essential drugs went up
from 30% to 65% in 1984.
 Price of imported raw materials reduced by 30-50%.
 Project Processing
Procedures in Bangladesh

 Prices of essential drugs reduced.

 Local enterprises share in local production
increased from 35% to 52% between 1981 to
1984.
 Ministry of Health organized meetings in
Nov. 1984 where it was agreed to suspend
further shipment.
 Institutions Engaged in Project
Processing in Bangladesh
Planning Commission/Division
The main vision of planning division is to support all
kinds of administrative and logistic works to fulfill the
proper planning procedure of Planning Commission
(Planning Organization) according to the rules and
regulation of Government. Planning division is also works
for proper administrative support to achieve the goal of
National Economic Council (NEC) and ECNEC
(Executive Committee of the National Economic Council)
 
 Institutions Engaged in Project
Processing in Bangladesh
 Planning Commission is the pivot of the
development project activity in Bangladesh.
As a central planning agency, it has a direct
macro level involvement with the projects.
 The Planning Division is headed by a
Secretary to the Government. There are two
wings under the Planning Division, namely
 Administrative Wing headed by a Joint Secretary
 ECNEC Wing headed by a Joint Chief
 Institutions Engaged in Project
Processing in Bangladesh

There are following divisions in the Ministry of

Planning (MoP) at present: 
Planning Division.

External Resource Division.

Statistical Division which houses the Bangladesh

Bureau of Statistics.
Implementation, Monitoring and Evaluation
Division (IMED).
(c) Dr Muhammad Abdul Mazid 2011
Planning Process
 Functions of the Planning
Commission
 The Bangladesh Planning Commission is the
central planning organization of the country. It
determines objectives, goals and strategies of
medium and short-term plans within the
framework of long-term perspective and
formulates policy measures for the achievement of
planned goals and targets. Its activities includes
the following elements of development planning:
 Policy Planning: determination of goals,
objectives, priorities, strategies and policy
measures for development plans;
 Functions of the Planning
Commission
 Sectoral Planning: identification of the role that the
various sectors of the economy are required to play
in the context of the Plan objectives and goals;
 Programme Planning: formulation of detailed
resource allocation to realize the Plan objectives and
goals;
 Project Planning: appraisal of projects embodying
investment decisions for the implementation of the
sectoral plans; and
 Evaluation: impact analysis of projects, programmes
and Plans on the people's living standard.
 Functions of the Planning
Commission/Division
 Preparation of national plans-annual, five-year
and perspective for the economic and social
development of the country in accordance with
the socio-economic objectives of the
Government of Bangladesh.
 Preparation of annual development programmes
within the framework of national plan and
formulation of policies for the implementation
and impact on the economy.
 Functions of the Planning
Commission
 Periodic review of national development plan,
study of its implications and impact on the
economy.
 Review on selective basis the operational
performance of various sectors of the economy.
 Evaluating plan, performance and watching the
progress of plan implementation on a continuous
basis in order to prepare evaluation on national
plans.
 Functions of the Planning
Commission
 Study of important economic issues and
formulation of economic policies and measures.
 Evaluation of external debts and submission of
reports thereon along with evaluation of national
plans.
 Undertaking and promoting economic research
and initiating surveys and investigations needed
to support effective planning and development.
 Functions of the Planning
Commission
 Advice on the nature of the machinery for securing
efficient execution of national plans, annual
programmes and economic policies.
 Stimulating and where necessary initiating project
formulation examining and tendering advice on
programmes and projects with a view to determining
their consistency with the national objectives.
 Co-ordination of economic policies which have
across the economy impact or involve more than one
Ministry/Division.
 Functions of the Planning
Commission
 Reviewing the progress of implementation of
approved projects, particularly aided projects;
identifying the causes of delays and difficulties
in the implementation of projects and proposing
solutions thereof.
 Co-ordination of development activities of
various Ministries/ Divisions and their agencies
where such activities are inter-related or inter-
dependent.
 Institutions Engaged in Project
Processing in Bangladesh
National Economic Council (NEC) 
The National Economic Council (NEC) of Bangladesh
is the highest political authority for development
activities. It formulates the national policy and objectives
for long-term plans. The Planning Commission is
entrusted with the task of preparing national plans and
programmes according to the directives of the ECNEC,
the executive agency of NEC policies. Ministries are
responsible to adopt their plans and programmes
according to the objectives set up by the NEC.
 Institutions Engaged in Project
Processing in Bangladesh
 The NEC consists of all members of the Council
of Ministers and is chaired by the Head of the
Government. The Deputy Chairman of the
Planning Commission and Governor of
Bangladesh Bank are special invitees to its
meetings. Members of the Planning Commission
and Secretaries in-charge of all Divisions are
expected to be in attendance during the meeting.
The NEC may meet in Committee as and when
required.
 Institutions Engaged in Project
Processing in Bangladesh
Composition of the Council
Prime Minister (Chairperson)

Ministers of the Council of Ministers (Member)

Supporting Officials
Cabinet Secretary

Governor, Bangladesh Bank

All Members, Planning Commission.

Secretary, Concerned Ministry/Division

 Functions of NEC

 To provide overall guidance at the stage of

the formulation of Five Year Plans. Annual
Development Programmes and Economic
Policies
 To finalize and approve plans, programmes
and policies.
 To review progress of implementation of
development programme.
 Functions of NEC
 To take such others decisions and actions as may
be considered necessary for socio- economic
development;
 To appoint such committees as deemed fit to assist
the NEC in the due discharge of its responsibilities.
■  Meeting of NEC will be held every month and can
be held earlier if required.
■  Planning Division will provide secretarial service to
the NEC.
 Executive Committee of the
National Economic Council
(ECNEC)
 ECNEC is the executive agency for implementation
of the policies decided by NEC (National Economic
Council). It is the highest level in the nation, which
comes into contact with the approval of an
individual project and is the ultimate approving
authority. It also reviews the projects as reported by
Implementation, Monitoring and Evaluation Division.
The ECNEC is headed by the Prime Minister, who
is the Convenor of the meeting.
 (ECNEC)
01. Prime Minister Chairperson
02. Minister, Ministry of Finance Alternate Chairman

03. Minister, Ministry of Planning Member

04. Minster, Ministry of Agriculture Member

05. Minister, Ministry of Labour and Employment Member

06. Minister, Ministry of Water Resources Member

07. Minister, Ministry of Commerce Member

08. Minister, Ministry of Communication. Member

09. Minister, Ministry of Shipping Member

10. Minister/State minister of the concerned Ministry Member

 (ECNEC)
Supporting Officials
01 Cabinet Secretary
02 Principal Secretary / Secretary, Prime Minister's Office

03 Secretary, Economic Relations Division

04 Secretary, Finance Division
05 Secretary, Planning Division
06 Secretary, IMED
07 Member, General Economics Division, Planning Commission

08 Member, Programming, Planning Commission

09 Secretary, Concerned Ministry/Division

 ECNEC Functions

 To consider and approve project concept

papers for all investment projects.
 To consider and approve public sector
projects having investment expenditure of
above Tk. 25 crore with prior
recommendation of PEC meeting.
 To review the progress of implementation of
development projects.
 ECNEC Functions

 To consider proposals for investment

companies as private, joint ventures with
foreign participation.
 To monitor the economic situation and review
over-all performance of the economy and
related policy matters.
 To consider the performance of statutory
corporations and especially their financial
performance.
 ECNEC Functions

 To consider rates, fees and prices of public utility

services or products of public enterprises
 To consider and approve yearly target of foreign
aid, expansion of trade, export of manpower as
well as to review the progress of the yearly
targets.
 Meeting of ECNEC is held as and when required
 Planning Division provides secretarial services to the
ECNEC.
 Monitoring & Evaluation of
Projects
 Monitoring and evaluation is a relative recent
addition to the scientific management. Project
management, seen as a scientific management
discipline, rather than an ad-hoc master builders
activity is, by itself, a rather newcomer.
 If we look at the project implementation as an input
and output system we are mainly dealing with the
management control cycle whereby corrective action
is initiated to improve upon subsequent results.
 Monitoring & Evaluation of
Projects
 Both with monitoring and evaluation we are mainly
looking at the feedback information channel. 
 Monitor the progress of development activities during
implementation and remain alert, in case of shortfalls or
deviations, for early corrective action;
 Ascertain systematically and objectively the relevance,
efficiency and effectiveness of development activities and
their impact on the intended beneficiaries;
 Understand lessons for future development planning, i.e. for
better formulation and implementation of projects and
programmes.
Implementation Monitoring
and Evaluation
 Project Monitoring Chain in
Bangladesh
 Process of Project Monitoring starts at the Project
Level itself. In a less fortunate country like
Bangladesh where resources are quite scarce, and
the country is heavily dependent upon external
resources, major developments investment takes
place in the public sector. Therefore, the position of
the concerned executive agencies, ministries
becomes significant in project
implementation/monitoring. At the national level there
is a body which monitors and evaluates the projects.
 Project Monitoring Chain in
Bangladesh

A. Project Level
The project managements with varying degree
of penetration and accuracy carry out the
monitoring and evaluation of the projects. The
projects use CPM, bar charts, periodical budget
follow-ups with different degree of success.
Generally it seems that large contractors
perform this task in their own interest. In some
projects the consultants perform this task.
 Project Monitoring Chain in
Bangladesh
B. Agency Level/Division Level
At the agency level there are Planning and
Implementation departments. The implementation
wing is in charge of project monitoring and
problem solving efforts at the agency level.
Generally a large executive agency is divided into
sectors (type of projects etc.) and they manually
monitor the projects individually, sector wise and
for the agency as a whole.
 Project Monitoring Chain in
Bangladesh
C. Ministry Level 
Every ministry has a Planning Cell which monitors the
project vis a vis budgeted allocation for the ministry.
The performance of the project is reviewed monthly at
the ministry level review meetings.
D. National Level
The national level IMED (Implementation Monitoring
and Evaluation Division), a division of Ministry of
Planning, looks after the overall macro level project
implementation, monitoring and evaluation.