Bangladesh

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Govt signs $142m loan agreements with ADB

Staff Correspondent | Published: 01:48, Jul 01,2020

 
 

The Asian Development Bank would finance $142 million to expand rural road networks and to promote multimodal transport in Bangladesh. 

The Economic Relation Division on Tuesday signed two separate agreements with the multilateral lender for the concessional loan.

ERD secretary Fatima Yasmin and ADB country director Manmohan Parkash signed the loan agreements on behalf of Bangladesh and the ADB respectively, the bank said in two separate press releases.

A $100 million loan agreement was signed to expand the coverage of an ongoing rural road network improvement project, connecting the rural population to agricultural lands, markets and services while another agreement for $42 million was signed to prepare road and railway sector projects to promote multimodal transport and connectivity in Bangladesh.

The rural road network improvement project would contribute to the government’s efforts for faster socio-economic recovery after the COVID-19 pandemic, Manmohan said in the release.

‘The expanded project will benefit around 90 million inhabitants in 34 districts with access to better health services, education, employment opportunities, markets and other government services,’ he said.

The ADB country director said inadequate rural transport and poor market infrastructure are critical challenges to Bangladesh’s rural development.

‘In addition to generating 1.73 million person-days of employment through infrastructure spending, the additional financing will also widen the opportunities for women and children to have easier and safer access to education, emergency health services, and other essential social services in any weather condition,’ he said.

This financing would scale up the current road network development, under the Rural Connectivity Improvement Project, from 1,700 kilometres to 2,630 km of rural roads, the ADB country director said.

He said that the overall project would continue to strengthen governance and institutional capacity in rehabilitating and maintaining rural roads with the use of a geographic information system to optimize monitoring of road conditions, thus sustaining an efficient rural road network that would boost further growth of the rural economy.

Manmohan said Bangladesh needs to boost connectivity between different transport modes, strengthen multimodal and arterial transport corridors, as well as construct bypass and connecting roads to promote domestic and international trade.

He said that multimodal transport could accelerate economic activities by reducing transportation costs and time, and increasing competitiveness, and efficiency.

The project is supported by a project readiness financing loan, which was introduced in 2018 and is due for completion at the end of 2024.

The total cost of the project is $57.2 million, of which the government will provide $15.2 million.

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