BD getting $400m AIIB budget support

Building climate resilience in dev focused in lending package

FE REPORT | Published: June 23, 2024 23:05:53

A US$400-million budget-support credit is forthcoming from the Asian Infrastructure Investment Bank (AIIB) for Bangladesh to help implement critical structural reforms meant for building climate resilience in development activity.
Mainstreaming climate-change adaptation and-mitigation actions for a sustainable, resilient and inclusive growth lies at the core of the lending package, officials said about the loan, incidentally coming at a time when the country is in a crying need for foreign exchange.
They said the board of directors of the AIIB, the Beijing-headquartered emergent multilateral development bank and international financial institution, is expected to approve the loan programme Thursday.
The loan will co-finance 'Climate Resilient Inclusive Development Programme (Sub-programme 1)' with the Asian Development Bank (ADB) that already provided $400 million for the programme.
"We are expecting to sign a loan deal with the AIIB in Dhaka the same day its board of directors approves the loan," a finance ministry official told the FE Sunday.
He said with funding from the ADB the key targets of the policy-based programme had already been achieved.
The programme tenure is June 30, 2024. However, the ADB has been requested to extend the deadline by three more months as the AIIB has joined lately for co-financing, said the official.
As programmed, the funding supports the government of Bangladesh in undertaking key policy reforms to mainstream climate adaptation, mitigation, and disaster resilience in critical sectors and unlock climate investments in Bangladesh.
Also in its purview is implementation of the GoB-led national climate objectives as articulated in the National Adaptation Plan (NAP) 2023-2050 and the Nationally Determined Contributions 2021 update (NDC-U) by strengthening the intergovernmental policy and institutional framework, mobilising climate finance, and mainstreaming gender equality and social inclusion (GESI).
The lending package further includes three policy-reform areas: enabling environment for climate-change actions, reinforcing climate-change-adaptation actions, and accelerating climate-change-mitigation actions to address some of the critical binding constraints.
By implementing the programme the government targets outcomes like enhancing sustainable and climate-focused development pathway, strengthening resilience and reducing risk and vulnerability to adverse climate-change impacts, mitigating greenhouse-gas emissions and transition into a low-carbon economy.
syful-islam@outlook.com