ADB lends $200m for infrastructure development

Dhaka,  Thu,  24 August 2017
Published : 09 Aug 2017, 13:48:43 | Updated : 10 Aug 2017, 10:41:30
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ADB loans $200m to boost urban governance, infrastructure in Bangladesh

FE Online Report
The Asian Development Bank (ADB) on Wednesday approved a US$200 million loan package to strengthen urban infrastructure, service delivery, and governance in Bangladesh’s municipalities.

The approval of the loan package at a meeting of the Board of Directors of the ADB in Manila headquarters also aimed at reinforcing resilience to climate change, according to a press release. 

ADB Urban Development Specialist Alexandra Vogl said, “The country’s municipalities still need significant investment to not only improve service delivery and the urban environment but also strengthen resilience to climate change.”

"This additional ADB financing for the well performing Third Urban Governance and Infrastructure (Sector) Project builds on the work of two previous ADB projects, expanding work in the pourashavas where we are already working and into five new ones,” Vogl added.

ADB provided a $65 million loan for a first performance-based urban project to support governance reforms and infrastructure improvements in 27 municipalities during 2003-2007. 

A second project followed in 2008-2016 backed by a loan of $87 million widening the support to 51 municipalities. 

Further supported by an ongoing third project, with an ADB loan of $125 million approved in 2014, urban infrastructure and governance has significantly improved.

The additional financing for the third project, bringing total ADB financing up to $325 million, will contribute to building or improving 600 kilometres (km) of roads and 300 km of drains, and install or upgrade 180 km of pipes for water supply with 60,000 metered household connections. 

Slum improvement work will be undertaken in all project towns that have slums while sludge management facilities will be built in 14 project towns and solid waste sites built or improved in 20.

The additional ADB financing approved this week will enable the continued funding of priority infrastructure and governance improvements in 35 municipalities with a total population of 3.1 million. 

Bangladesh economy has been growing at a healthy pace but the government faces the challenge of achieving sustainable and inclusive growth in the face of rapid urbanisation. 

Another critical issue facing Bangladesh is climate change, as the country faces rising temperatures; more frequent and intense rainfalls, storms, and flooding; and danger to coasts from rising sea levels. 

In the face of these, municipalities need to enhance their institutional know-how to maintain infrastructure and services.

This work will also focus on drawing up plans to tackle poverty reduction, gender issues, slum improvement, community participation, and improving municipal financial management.

The implementation period for the project spans from August 2017 to June 2021.
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