$150m ADB loan to raise BR capacity
Tuesday, 28 August 2012
FE Report
The Asian Development Bank (ADB) will provide US$150 million loan to improve the capacity of the state-owned Bangladesh Railway (BR), officials said.
Economic Relations Division (ERD) Senior Secretary Iqbal Mahmood and ADB Country Director M Teresa Kho have signed an agreement in this regard in the city.
The loan, provided under the Bangladesh Railway Sector Improvement Project, will be used to construct 64 kilometres double-track railway lines from Tongi to Bhairab Bazar, improve signalling system of 11 stations in Darshana-Ishwardi section, and rehabilitate yards and extend loops in Darshana-Ishwardi-Sirajganj Bazar section.
In 2006, the ADB had confirmed $430 million loan to revamp the country's entire railway system. Under the deal, the lender has already disbursed $130 million for double-tracking the Tongi-Bhairab Bazar line and implementing various reforms. The rest of the amount will be given in three phases.
The ADB's $150 million credit from its hard-term Ordinary Capital Resources (OCR) wing will have to be repaid at London Inter Bank Offered Rate (LIBOR). The loan will be matured in 25 years with five years grace period.
Upgrading the railway network will reduce transport cost of local export items, especially ready-made garments.
The improved railway system will ease pressure on congested road network. It will also help boost regional trade and investment by improving a cost-effective communication system.
Teresa Kho said: "The reforms and infrastructural development to be accomplished will help increase container transportation by 10 per cent, and raise the number of daily trains in Tongi-Bhairab Bazaar section by 25 per cent by 2020."
"The improvement will result in low operating cost of users and increase the competitiveness of Bangladesh for investment," she added.
Iqbal Mahmood thanked the ADB for its financing to improve the country's railway system.
The Asian Development Bank (ADB) will provide US$150 million loan to improve the capacity of the state-owned Bangladesh Railway (BR), officials said.
Economic Relations Division (ERD) Senior Secretary Iqbal Mahmood and ADB Country Director M Teresa Kho have signed an agreement in this regard in the city.
The loan, provided under the Bangladesh Railway Sector Improvement Project, will be used to construct 64 kilometres double-track railway lines from Tongi to Bhairab Bazar, improve signalling system of 11 stations in Darshana-Ishwardi section, and rehabilitate yards and extend loops in Darshana-Ishwardi-Sirajganj Bazar section.
In 2006, the ADB had confirmed $430 million loan to revamp the country's entire railway system. Under the deal, the lender has already disbursed $130 million for double-tracking the Tongi-Bhairab Bazar line and implementing various reforms. The rest of the amount will be given in three phases.
The ADB's $150 million credit from its hard-term Ordinary Capital Resources (OCR) wing will have to be repaid at London Inter Bank Offered Rate (LIBOR). The loan will be matured in 25 years with five years grace period.
Upgrading the railway network will reduce transport cost of local export items, especially ready-made garments.
The improved railway system will ease pressure on congested road network. It will also help boost regional trade and investment by improving a cost-effective communication system.
Teresa Kho said: "The reforms and infrastructural development to be accomplished will help increase container transportation by 10 per cent, and raise the number of daily trains in Tongi-Bhairab Bazaar section by 25 per cent by 2020."
"The improvement will result in low operating cost of users and increase the competitiveness of Bangladesh for investment," she added.
Iqbal Mahmood thanked the ADB for its financing to improve the country's railway system.