Cost-Benefit analysis for freight transportation of Bangladesh

Bangladesh has witnessed rapid growth in transport demand, since mid eighties till now, the annual growth rate were 8.2% and 8.4 % respectively for freight and passenger transport demand. This paper describes how benefits and costs vary for multi-modal transport options and travel conditions. It primarily considers road and rail freight transport. It provides an analysis framework which includes estimates of unit cost (Tk/per km/per vehicle) for different travel modes. Different parameters have been used to compare the level of service of different modes and help to have an overall knowledge about the present situation of freight transport in Bangladesh. The result shows that the rate of per unit cost for road and railway are 3.04 tk/ton/km and 1.49 tk/ton/km respectively. Inspite of higher cost, during the last two decades, road freight has grown at a compounded growth rate compared to rail. This shift in freight mode is due to long travel time, lack of maintenance and care of railway department, lack of funding in railway department and overall bad image of the railway system of the country.