WB warns against cancellation of funds
Friday, 15 June 2007
FHM Humayan Kabir
The World Bank (WB) has cautioned Bangladesh against possible cancellation of funding support for a power project for delay in implementation, sources said.
The WB in a letter to Power Division recently said that if the Power Development Board (PDB) and the West Zone Power Distribution Company Limited (WZPDCO) failed to hand over 615km of electricity distribution lines by August 31 to Rural Electrification Board (REB), it could suspend disbursement of remaining US$35 million of the committed fund.
The WB has been providing fund since January 2003 to the Rural Electrification and Renewable Energy Development Project. It committed to give $190 million until the completion of the project in June next year.
The Bank said that although the project period will close in June 2008 and it still has $80 million of undisbursed balance, the government has, so far, failed to take necessary measures to complete the project in time.
A senior Power Division official said that the handing over of distribution lines to the REB had become difficult due to legal complications.
Under the project, more than 0.47 million consumers are to get electricity connections. The REB installed and renovated 17,000km of electricity distribution lines in 2,754 villages and the Infrastructure Development Company Limited (IDCOL) has set up more than 0.11 million solar home system (SHS) since January 2003.
The World Bank said that court cases had prevented the transfer of lines to the REB for many years due to absence of court hearing. "Without settling these cases, the third tranche of the project amounting to $35 million will remain unutilised," it said in its letter.
According to the WB letter, "The government is requested to make arrangement to prevent further prolonging of these cases and bring about an early resolution."
The Washington-based donor agency also called upon the government to process the remaining procurement activities efficiently to ensure full utilisation of the available fund worth about $80 million, to complete the third package of line transfer from the PDB to the REB through coordinated actions.
The World Bank (WB) has cautioned Bangladesh against possible cancellation of funding support for a power project for delay in implementation, sources said.
The WB in a letter to Power Division recently said that if the Power Development Board (PDB) and the West Zone Power Distribution Company Limited (WZPDCO) failed to hand over 615km of electricity distribution lines by August 31 to Rural Electrification Board (REB), it could suspend disbursement of remaining US$35 million of the committed fund.
The WB has been providing fund since January 2003 to the Rural Electrification and Renewable Energy Development Project. It committed to give $190 million until the completion of the project in June next year.
The Bank said that although the project period will close in June 2008 and it still has $80 million of undisbursed balance, the government has, so far, failed to take necessary measures to complete the project in time.
A senior Power Division official said that the handing over of distribution lines to the REB had become difficult due to legal complications.
Under the project, more than 0.47 million consumers are to get electricity connections. The REB installed and renovated 17,000km of electricity distribution lines in 2,754 villages and the Infrastructure Development Company Limited (IDCOL) has set up more than 0.11 million solar home system (SHS) since January 2003.
The World Bank said that court cases had prevented the transfer of lines to the REB for many years due to absence of court hearing. "Without settling these cases, the third tranche of the project amounting to $35 million will remain unutilised," it said in its letter.
According to the WB letter, "The government is requested to make arrangement to prevent further prolonging of these cases and bring about an early resolution."
The Washington-based donor agency also called upon the government to process the remaining procurement activities efficiently to ensure full utilisation of the available fund worth about $80 million, to complete the third package of line transfer from the PDB to the REB through coordinated actions.