November 26, 2019

Government Abandons Butaro Road Project After Indian Companies Double Construction Cost

Trustworthy and indepth news stories are more important now than ever.
Support our newsroom by MAKING A CONTRIBUTION HERE
Finance and Economic Planning Minister Dr Uzziel Ndagijimana speaking before a joint session of Parliament this Tuesday November 25, 2019

Government of Rwanda suspended construction of a road leading to a major hospital and international university when contractors sought to rip-off government, it has emerged.

A private company, which had earlier also agreed to construct the same 64km road, suddenly decided to drop out, citing unexpected costs which had risen and high cost of financing from banks.

The road in question is the Base-Kirambo-Butaro-Kidaho in northern province. It was to be tarmacked, heading to the world-reknowned Butare Hospital and Cancer Institute, as well as the University of Global Health Equity (UGHE).

The highway was to also connect Rulindo and Burera districts, as well as link the rest of the country to touristic parts of Burera district including Lake Ruhondo.

Construction began in July 2016 by NPD Cotraco at Rwf 71billion. The firm is private construction company of the Rwanda Patriotic Front (RPF) party’s holding company Crystal Ventures. The firm had agreed with Government that it would singlehandedly construct the road, and government would repay it through instalments.

Appearing before joint session of Parliament this Tuesday, Finance and Economic Planning Minister Dr Uzziel Ndagijimana said the private entity, which he did not name, gave up on the project by mid last year.

Lawmakers had asked the Minister, as part of his first quarterly economic update, to explain why construction on the Base-Butaro-Kidaho road had stopped for now over a year.

Dr Ndagijimana said after the private entity abandoned works, government sought a loam from the India Export Import Bank (EXIM), which was indeed acquired. However, the process fell apart.

Back in May 2018, the Finance Minister himself put-pen-to-paper on a financing agreement with India EXIM Regional General Manager Tarun Sharma at a function in Kigali. The loan was $66.6m.

Construction did not get underway, reason why lawmakers were seeking explanation from the Finance Minister.

He told MPs of the tough conditions imposed by the Indian government to release the financing.

Lake Ruhondo is Burera district is increasingly becoming a tourist spot. This road would have brought much-needed cash into the local economy, as well as link to major hospital and international university

First, the road would be constructed by Indian companies, said Dr Ndagijimana. They informed us that such loans are given out to create employment for Indians, added the Minister.

The next stage was that five Indian road construction companies submitted bids. It is at this stage that the whole loan scheme went into crisis.

“The companies submitted bids which were more than two times the cost we had anticipated. We couldn’t continue,” said the Minister, in surprisingly candid revelations to the lawmakers.

He added: “The initial planning for the road was done in accordance with standard procedures and also based on other similar roads. It is unlikely that the original plans were done wrongly. We couldn’t understand how these Indian companies had decided to demand for such high costs.”

If government had opted to go ahead with the construction of the Base-Butaro-Kidaho road, it would have had to seek a loan of up to $150m.

The Finance Minister said government had gone back to drawing board to review the project and how it will be funded. A new alternative will be found very soon, he added.

ERRATA: This story has been slightly edited to remove reference to the Ministry of Defense which was in previous version. NPD Cotraco is not in any way attached to this Ministry. We apologize for the error.

We can't do quality journalism without your support

Perhaps it goes without saying — but producing quality journalism isn't cheap. At a time when newsroom resources and revenue are declining, The Chronicles remains committed to "Serving Your Right To Know The Truth". Stand with us as we document Rwanda's remarkable journey for you and the future generation. Do you value our journalism? We can't do it without you. Show us with your support by CONTRIBUTING HERE.
Email your news TIPS to or WhatsApp +250788351327.
You can also find us on Signal


  1. Afin de dissiper complètement vos doutes, vous pouvez savoir si votre mari vous trompe dans la vraie vie de plusieurs manières et évaluer les preuves spécifiques dont vous disposez avant de soupçonner que l’autre personne vous trompe.

Leave a Reply

Your email address will not be published. Required fields are marked *