Bangladesh's highest economic policy-making body gave the green-light to a proposal on Tuesday to construct a tunnel beneath Karnaphuli river with Chinese soft loans.
The project was approved at a meeting of the Executive Committee of the National Economic Council chaired by Prime Minister Sheikh Hasina.
Planning Minister AHM Mustafa Kamal told reporters after the meeting that the tunnel project, which is to be implemented with with soft loans from China, will cost 84.47 billion taka (about 1.07 billion U.S. dollars).
The two-lane tunnel will be constructed beneath the river Karnaphuli in Chittagong, some 242 km southeast of capital Dhaka, he said.
Kamal said China Communication Construction Company Ltd (CCCC) will build the tunnel and construction will begin in November 2016. The tunnel will be handed over to the Bangladeshi government in June 2020, he said.
Bangladesh's Road Transport and Bridges Ministry in June this year signed a deal with the Chinese state-owned company for construction of the tunnel, a mega Bangladeshi project the Chinese have agreed to fund.
The length of the tunnel is 3,400 meters while the west bank approach road will be 740 meters and the east bank approach road 4,952 meters.
On June 9 last year, Bangladesh and China signed a memorandum of understanding (MoU) on construction of the tunnel in Chittagong which is the principal seaport city in Bangladesh.
Most of the country's export and import activities are being carried out through Chittagong Port situated at the mouth of the Karnaphuli River.