Amid the higher foreign debt burden, Bangladesh is set to embark on a large-scale $700 million World Bank-supported programme to improve the livelihoods of Rohingya refugees and their host communities, officials said on Wednesday.
Although the government's many ongoing priority development projects are struggling with fund shortages, insiders say the programme will include building a 10-megawatt (MW) solar power plant in Bhasan Char, installing 3,000 latrines in Cox's Bazar, constructing roads and markets, planting trees and bolstering the health and education systems for the Rohingya community in Bangladesh.
More than ten ministries and public agencies will collaborate to implement the programme -- the majority of the funding for which will be borrowed from the World Bank, they said.
Out of the total $700 million, the Washington-based lender is expected to provide $385 million as a loan and the remaining $315 million as a grant.
The Planning Commission has encountered a hurdle as various ministries and agencies have submitted separate project proposals, nearly 11 in total, for funding under the World Bank's $700 million fund.
"We were perplexed to receive multiple project proposals when a single funding proposal would have sufficed," a senior planning said. "We are currently considering whether to approve the projects individually or consolidate them under one umbrella proposal."
Pressure to expedite approvals
According to insiders, the Planning Commission is facing pressure to approve the projects swiftly.
"A World Bank board meeting is scheduled for April and we are advised to approve the projects beforehand," said officials from the Economic Relations Division (ERD) and the Planning Commission.
"The World Bank board will only consider Bangladesh's $700 million proposal once the projects are approved."
"Hopefully, the individual projects would be categorised but approved under one or two umbrella projects," said an official.
"For instance, infrastructure development projects could be combined under one umbrella, while social development projects from various ministries could be grouped under another," he explained.
According to senior planning officials, the $700 million project will benefit both the Rohingya refugee population and Bangladeshi host communities in the Cox's Bazar area, where the forcibly displaced Rohingya from Myanmar reside.
Project breakdown
According to the proposed project proposals, the Local Government Engineering Department (LGED) will be allocated $142 million to improve rural roads, markets (hat-bazars) and other infrastructure in Cox's Bazar.
The Department of Public Health Engineering (DPHE) will use $110 million from the World Bank's $700 million support to establish sanitary latrines and other essential infrastructure.
The Roads and Highways Department (RHD) plans to invest $70 million to widen 48 km of roads in Cox's Bazar, Bandarban and Chittagong.
The Power Development Board will use $18 million to set up a 10-megawatt (MW) solar power plant to provide electricity for the Rohingya population in Bhasan Char.
The Department of Forest will implement a tree plantation programme in Bhasan Char at $5 million and the Department of Environment will conduct an environmental impact assessment in Cox's Bazar and Bhasan Char, also at $5 million.
Officials said four to five other ministries and agencies are also undertaking six more projects focused on the social sector to improve health, education and other social services.
Planning Commission officials told The Financial Express that the finance ministry has been unable to allocate sufficient funds for many ongoing projects, including land acquisition, research and maintenance activities, due to the government's internal funding constraints.
"With Bangladesh's foreign exchange reserves low, revenue income declining and export and remittance inflows not improving as expected, undertaking such a low-priority project is not a wise decision," a senior planning commission official argued.
The government should refrain from taking on such low-priority projects at this time, especially through external borrowing, as this would further burden the country's foreign debt, he added.
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