Sources claimed that a gang known as 'town group' backed by a political party based in the Chittagong Hill Tracts (CHT) demanded the toll.

The Tk 10 crore work for renovating 26 kilometre road was started in April last year and was scheduled to be completed last month.

Workers are now sitting idle at their sheds, the sources said.

A local sub-contractor is doing the work on behalf of the main contractor M/S Taher and Brothers, a Dhaka-based construction firm, the sources said.

"We have reached an understanding with the group to resume work after payment of Tk 5 lakh", a source close to the contractor said yesterday. "We are now hoping to resume work soon".

Sources in the Roads and Highways (R&H) Department admitted that the project work is stopped but declined to say anything about the reason.

"The contractor has to spent a huge amount of money to feed 30 to 40 laborers every day without work", an official at the R&H office said.

Earlier, the same group abducted a contractor, Md Abul Hashem, from his K K Roy Sarak residence about one and a half years ago. He was freed after payment of Tk 5 lakh, sources close to Hashem's family had said.

The group also abducted a laborer as a contractor engaged for construction of the Rangamati Stadium did not pay toll. The labourer was freed after toll payment.