World Bank helps Bangladesh transform public procurement into a sustainable online system

Beneficiaries

"Before the e-GP was introduced, we had to submit tenders manually. We had to carry a huge amount of paperwork to Motijheel. It was a big hassle. On top of that, there were political muscle men who would try to prevent us from bidding. After e-GP was introduced, the process has become easy. The e-GP training helped us a lot. We learned that we could store our company papers in the system online and draw from there each time we needed those documents. We simply had to map the document to the tender submission. The training taught us how to scan the documents, what size the documents had to be, how many documents to include in a file, how to name the files. Those without IT backgrounds especially benefited from this training." Ahsan Habib, GM of Connect BD Ltd., e-GP Tenderer

Challenge

Public procurement reform is extremely complex and hard to sustain due to the involvement of numerous stakeholders with diverse and sometimes conflicting interests and resistance to change. The process in Bangladesh required not only technical but also substantial political commitment and behavioral interventions.

Approach

Since the Bank engaged in the initiative in 2002, critical elements have been addressed in an integrated way, including building capacity among public officials and the bidding community and enabling engagement between the two. The process involved developing and adopting innovative technology, as well as campaigns to change behavior and raise awareness among stakeholders and across society about the importance of the reform in achieving national development goals.

The government also created the Central Procurement Technical Unit (CPTU), within the Planning Ministry to spearhead the reforms. These efforts helped ensure political buy-in, ensuring a comprehensive and sustainable transformation.

The Bank has offered a measured approach, opting for a strategic engagement through three successive phases. Phase I entails enactment of procurement legal framework (Law/Rule) and establishment of an institutional central regulatory agency. With this foundation, the reform was rolled out in the follow-on phase II through a large-scale professionalization and capacity development effort, introduction of e-GP, and raising awareness among citizens to support sustained reform.

The current phase covers robust end-to-end e-Government Procurement system, creating platforms for citizen engagement and social accountability, and introducing sustainability considerations in the public procurement framework.  

The e-GP system has improved the integrity of public procurement with features such as online submission and evaluation of bids, approval, and award of contracts, reducing external influences, preserving all procurement documents and transactions online for audit purposes, validating bidders’ information, and online submission and tracking of complaints.                   

• In 2023, procurement lead time (from invitation to contract signing) for all e-GP tenders decreased from 100 days to 53 days, resulting in improvement of efficiency in service delivery. In addition, the number of registered bidders in e-GP increased to 103,250, demonstrating wider market access compared to manual bidding.
• About 80 percent of Bangladesh’s public procurement expenditure was processed through the e-GP system in year 2022, compared to only 2 percent in 2017.  
• Use of e-GP has led to about 7 percent savings in procurement costs compared to manual paper-based procurement. In 2023, estimated savings to the government budget reached $1.4 billion.
• The e-GP system worked as the backbone to continue day-to-day development operations in the country. It enabled about 1,300 public organizations to process all procurement activities (from bid invitation to contract award) online, which has drastically reduced administrative costs for bidding while also eliminating the potential risk of coercive practices.       
• An online citizen portal  (www.citizen.cptu.gov.bd) has been launched for to monitor the implementation of public procurement contracts, and citizen engagement in contract implementation monitoring is taking place in 48 sub-districts.
• 30,000 stakeholders, including government officials, policymakers, private sector contractors and suppliers, academics, media, and civil society organizations have benefited from training received under the project. This has created a critical mass of qualified specialists and sensitized stakeholders necessary to expand the coalition of reform supporters with the capability to deliver and monitor change.  

Bank Group Contribution

The International Development Association (IDA) has provided $95 million for the third and last stage of the e-GP project, formally called the Digitizing Implementation Monitoring and Public Procurement (DIMAPP).

Partners

The Central Procurement Technical Unit (CPTU), Implementation Monitoring and Evaluation Division (IMED), Ministry of Planning, which is the country’s procurement policy unit, is mainly responsible for the project’s implementation. The Local Government Engineering Department is supporting the implementation of e-GP, providing training and hands-on support in 890 local government institutions (LGIs). The International Training Center of the International Labor Organization in Turin, Italy (ITC-ILO); the Chartered Institute of Procurement and Supply (CIPS) in the United Kingdom; the BRAC Institute of Governance and Development (BIGD) under the BRAC University; and Engineering Staff College Bangladesh (ESCB) are responsible for the major capacity development program. Citizen engagement is implemented with the partnership of BIGD and BRAC’s Community Empowerment Program.

Looking Ahead

The e-GP system is running on a self-sustaining model. It is generating revenue—earning approximately $215 million in 2022—and will be able to cover its own operations and maintenance costs by the end of 2023. The project included new features of e-GP such as international procurement, direct contracting, framework agreement, electronic contract management and payment, and geo-tagging to be implemented during 2023-2024. Rolling out a digitized system of comprehensive contract management (e-CMS), including payment to the contractors, is under way and when fully adopted will bring more transparency to contract management and the payment process.

 Incorporating sustainability considerations in public procurement is critical for Bangladesh’s efforts to align with the World Bank Group’s Green, Resilient and Inclusive Development (GRID) approach in Bangladesh. GRID not only includes environmental considerations to promote green public procurement, but also socio-economic considerations to enable more inclusive public procurement. The Sustainable Public Procurement (SPP) Policy drafted under DIMAPPP will gradually incorporate environmental and social sustainability principles in standard bidding documents of targeted sectors, including gender criteria for fostering participation of women-owned businesses in public procurement.