"The ground breaking project has lately come to a virtual standstill," WB Country Director Xian Zhu said in a letter dated March 14 to the secretary to the Ministry of the Local Government, Rural Development and Cooperatives.

"The overall progress has suffered considerable delay, negatively impacting follow-on activities that cannot be carried out because they are dependent on previous steps or actions," he said in the letter.

The WB issued the grants to the Department of Public Health Engineering for such an innovative project for the first time. But the project is facing uncertainty due to unwanted interference of the then secretary to the local government ministry of the BNP-led four-party alliance government, sources said.

The objective of the project is to contribute to Bangladesh's efforts in achieving the millennium development goals in water supply and sanitation by 2015. The project that started in July 2004 will specifically pilot innovative measures to scale up the provision of supplying safe water free from arsenic and pathogens in rural areas and small towns.

The proposed date for the completion of the project is June 2009.

A report meanwhile shows that about Tk 9.20 lakh has been spent as of January this year as salaries of some 87 staffs while Tk 83.04 lakh has been spent to pay its consultant, Tk 3.37 lakh for buying computers, electric equipment and office materials, and Tk. 7.84 lakh for car maintenance, purchasing fuel and other purposes.

However, no money has been spent and no significant task has been done regarding the piped water supply schemes in rural and municipality areas, and the rural non-piped water supply scheme, said the report.

"Our main concern is that the project's midterm review is due in the coming months and the project has only disbursed 1% of the total grant while half of the project period has lapsed," Zhu said in his letter.

"My colleagues have informed me that the situation may lead to a loss of confidence in the process and in the project...Our serious concern remains the lack of a proactive role of the project management unit (PMU).

"Such slow and reactive project management is thus starting to have a consequence on the implementation capacity of the DPHE and the programme's overall performance," Zhu observed.

On the progress of the project, the WB country director wrote to the secretary, "We do not necessarily correlate project progress directly with the disbursement; you would agree that 1% is excessively low given the time under implementation."

The project aims at promoting rural piped water supply with private sector participation, private-sector participation in water supply in municipalities, implementing arsenic mitigation measures in arsenic affected villages, supporting development of adequate regulations, monitoring, capacity building and training.

It has been about 34 months since the project started but not even one percent of the work has been implemented, said a project official.

"The future of this project is now uncertain, as the World Bank is not happy with its progress," he told The Daily Star requesting anonymity.

A few DPHE officials alleged that the then secretary to local government, rural development and cooperatives ministry, Zohurul Islam, interfered in the project to serve the interest of an influential quarter.

Zohurul was the key person behind replacing Khoda Bux from the post of project director (PD) and appointing Kamal Uddin, they said, adding that this annoyed the WB as prior permission of the WB is needed to bring any change in the post.

"The then minister for local government inquired Zohurul if the World Bank had given consent to the change in the post of project director but Zohurul lied to the LGRD minister that the World Bank had consent in this regard," a source said.

"Kamal Uddin got the blessings of the former BNP government as he was a relative of a former BNP lawmaker," the source added.

The WB already had bitter experience of Kamal's performance as the PD of another WB project entitled "Arsenic Mitigation Water Supply Project" as its progress was also not satisfactory, said the source.

Some 14 objections came up during the audit of the project showing violation of financial discipline, loss of project money and other irregularities.

Zohurul, now an officer on special duty (OSD), however, denied the allegation of his intervention in the project. "What I did regarding the water supply project was routine work, not intervention," he told The Daily Star.

Blasting the former PD, he said, "Khoda Bux gave wrong information about the project to the World Bank and that is why they [the WB] got angry with me...Khoda Bux was an inefficient PD--he approved many projects without taking consent of the chief engineer."

On changing the project director without taking prior consent of the WB, he said, "This is not true."

Kamal Uddin, the present PD appointed in July last year, said, "The progress the project has achieved so far has been possible for me."

On the audit objection raised against him when he was the PD of the Arsenic Mitigation Water Supply Project, he said, "The audit report was not based on fact."