$142m ADB loan for rail, road network

FE REPORT | Wednesday, 1 July 2020

The Asian Development Bank (ADB) has agreed to provide $142 million in loans for improving Bangladesh's railway link and rural road network.
The Manila-based lender and economic relations division (ERD) signed two separate loan agreements for two different projects on Tuesday.
ERD secretary Fatima Yeashmin and ADB country director in Bangladesh Manmohan Parkash remotely signed both the credit deals.
As per a $100-million loan, local government engineering department (LGED) will build and upgrade rural roads in 34 districts across the country.
This loan is an additional financing as the creditor confirmed to the government another $200-million loan in the first phase in 2018.
Under the rural connectivity improvement project, the LGED will improve 1,700 kilometres (km) to 2,630 km of rural roads to all-weather standards with climate resilience and safety features.
The expanded project will benefit an estimated 92-million people.
The country's inadequate rural transport and poor market infrastructure are major challenges to the rural development.
The situation is further worsened by recurrent floods and disasters that paralyse agricultural value chain.
Less than half of the rural population has access to all-weather roads, which make up less than a third of the total length of rural roads here.
The government wants to increase the percentage of the country's rural roads classified as good from 43 per cent in 2016 to 80 per cent in 2020.
The overall project will continue to strengthen governance and institutional capacity in maintaining rural roads with the use of a geographic information system to optimise monitoring of road conditions.
The system will sustain an efficient rural road network that would boost further growth of the rural economy, according to the ADB.
Meanwhile, the bank's another $42-million loan will help railway to promote multimodal transport and connectivity in Bangladesh.
The Bangladesh Railway has undertaken a project at $57.2 million, of which the government will provide $15.2 million and the ADB the rest $42 million.
The fund will help in feasibility studies, detailed design, risk assessment for gender, labour and other social issues, environmental impact, climate risk and vulnerability assessment, and environmental management, resettlement, risk mitigation and indigenous people's plans for ensuing projects.
Mr Parkash said, "Bangladesh needs to boost connectivity between different transport modes, strengthen multimodal and arterial transport corridors, construct bypass and connecting roads to promote domestic and international trade."
Given the impact of COVID-19 pandemic, the improvement of transport connectivity is critical for ensuring robust local and global supply chain, he added.