The projects include diplomatic buildings, procurements for the railway, and highway development
The incident occurred in the area's Bank Colony on Wednesday morning, said Mugda Police OC Pranay Kumar Saha.
The dead was identified as Hashi Begum, 27. Police are interrogating her Komol Hossain over the incident, said the OC.
Komol sells machineries in the area. He married Hashi nearly eight months ago. This was the second marriage for both.
The lower parts of Hashi's body and her hair was burnt, said the OC, adding,"During the primary investigation, Komol confessed to setting fire to her body in an effort to mislead people on the cause of death."
The body has been sent to the Dhaka Medical College Hospital's morgue for a post-mortem.