More than Tk1,000 crore in public funds was drained from government ICT projects through inflated procurement, idle equipment and opaque budgeting over the past decade, a White Paper on the ICT Division has found after reviewing 43 Development Project Proposals.
The losses did not occur through isolated errors or poor estimation. Instead, the White Paper concludes that the anomalies were “systemic, measurable and preventable”, embedded in how ICT projects were designed, approved and repeatedly revised over the years.
The analysis shows that ICT hardware was routinely procured at “two to four times global benchmark prices”, with several categories exceeding even those margins.
Hardware was prioritised in the review because physical equipment allows reliable benchmarking against global and regional markets using historical exchange rates and inflation data.
Servers emerged as a major driver of overpricing. In one project, a single server was listed at Tk8.61 crore, while comparable enterprise-grade servers available during the same period rarely exceeded Tk3 crore even after accounting for import duties and currency adjustments.
Across projects, servers were priced at between 3-35 times the realistic market value.
Substations showed even more extreme distortions. One project billed a substation at more than Tk1,800 crore against a realistic benchmark of roughly Tk25–30 crore.
Similar patterns were found in generators, transformers and lifts, with inflation ranging from 30 percent to more than 1,000 percent. Solar power systems were procured at nearly three times prevailing market rates.
These discrepancies, the White Paper notes, cannot be justified by superior quality, safety features or installation complexity. Project documents frequently lacked bills of quantities, commissioning certificates and technical specifications, leaving no credible basis to verify whether costs matched delivered equipment.
At the core of the problem is what the report identifies as “under-specification with overpricing”.
High-value items were often described using vague labels such as “ICT equipment” or “server”, without brand names, model numbers, quantities or performance criteria. This ambiguity allowed inflated pricing to pass through approval processes with little resistance.
Repeated revisions to Development Project Proposals compounded the damage.
In several cases, revised DPPs expanded lump-sum allocations without improving technical clarity or documentation, turning revisions into a pathway for fiscal leakage rather than correction.
Overpricing was further amplified by procurement without operational readiness. The White Paper documents repeated cases where institutions lacked trained staff, supporting infrastructure or deployment plans, leaving expensive hardware unused or severely underutilised.
These purchases are described as “idle assets”, representing sunk costs that deliver no public value while creating future maintenance liabilities.
Several projects also promised digital platforms, mobile applications or e-libraries that remain incomplete or non-functional despite substantial spending. In such cases, the report flags the risk of “phantom deliverables”, where funds are disbursed but outcomes cannot be verified.
Education- and skills-focused ICT projects were not immune. Laptop procurement across multiple initiatives resulted in excess spending of more than Tk3,200 lakh, driven by inflated unit prices, bundled contracts and limited competition.
Smart televisions and digital displays were procured at up to double market value, while routers, accessories and lab equipment were listed without specifications.
Training and empowerment projects showed similar weaknesses. Budgets running into tens of crores were approved without baseline assessments, skills testing or employment tracking.
In several cases, training costs were inflated many times over realistic estimates, while institutional capacity showed little measurable improvement.
Large national ICT programmes magnified these risks. Flagship projects such as SHIFT and EDGE were marked by repeated revisions, lump-sum budgeting and weak documentation. In SHIFT, Tk44 crore in overpricing was directly identified, with an additional Tk178 crore remaining unresolved due to vague allocations for training, consultancy and equipment.
The EDGE programme, with a revised budget exceeding Tk28,000 crore, approved large grants and ICT equipment packages without itemisation, creating fiscal risks estimated in the hundreds of crores.
Cybersecurity projects followed the same pattern. SIEM systems, security operations centres and public key infrastructure hardware were procured through lump-sum budgets without technical detail.
Enterprise-grade systems that typically cost far less were approved at inflated prices, while consultancy and certification services were duplicated across vendors.
Based on conservative calculations, the White Paper quantifies Tk665–737 crore in confirmed procurement anomalies. An additional Tk300–400 crore remains unresolved due to opaque budgeting and missing documentation. Taken together, the potential fiscal exposure exceeds Tk1,000 crore, equivalent to roughly $90–100 million.
The White Paper warns that the consequences extend beyond financial loss. Inflated procurement weakens institutional capacity, delays digital transformation and erodes public trust.
Without structural reform—clear specifications, market benchmarking, independent verification and milestone-based payments—it concludes that public resources will continue to be drained under the banner of digital development, it added.
