The Asian Development Bank Committed to Provide Loan in the Next Three Years

The Asian Development Bank Committed to Provide Loan In The Next Three Years

The Asian Development Bank (ADB) has pledged to source Bangladesh with approximately $9.4 billion loan in the upcoming three years to recover the country from the COVID-19 hit and global uncertainty impacts. On 24 July, the Manila-based bank informed the Economic Relations Division (ERD) that Bangladesh will receive more than $3 billion annually under the Bangladesh lending pipeline from 2023-2025.

The ADB offers two different types of loans: soft loans from regular capital resources are issued at a fixed 2% rate, while regular loans from regular capital sources have interest rates based on the secured overnight financing rate plus a contractual margin of 0.5%.

According to ERD & ADB officials, a total of 44 projects are to be financed by the ADB. A list of confirmed projects was compiled after consultation with various government agencies.

According to the Bangladesh Lending Pipeline 2023-2025, “ the highest amount of lending will go to the transportation sector worth $2.9 billion, followed by the education and health sectors $2.35 billion, $1.39 billion for water and urban areas, $1.3 billion for finance, $1.07 billion for energy, and $441 million for agriculture.”

Over the next three years, the ADB will fund a few projects related to roads and railways. The Akhaura-Laksam Double Track Project will get $300 million in lending in 2023. Dhaka-Northwest Corridor Road Project will get $700 million in two consecutive years. A $100 million investment will be made in the development of Dhirasram Inland Container Depot in Gazipur in 2023.

The education and health sector will get $500 million in support for the healthcare improvement projects. In order to upgrade the regulatory system and produce vaccines, a global lender will contribute $300 million.

Additionally, the ADB has committed $250 million for the Second Strengthening Social Resilience Program. Moreover, under the sustainable economic recovery program, the ADB will provide Bangladesh $250 million in budget support in 2023. Along with supporting the growth of secondary education for the next generation, it will lend $600 million for skill development over the course of two years.

The $500 million budget funding for the climate change strengthening program will be distributed in two installments in 2023 and 2025. Additionally, Bangladesh will get $250 million from the international lender in 2025 as part of the “Strengthening Economic Structure for LDC Graduation” initiative.

The Bangladesh Country Programming Mission (CPM) report-2022 states that the ADB would assist the country’s critical infrastructures’ ongoing improvement. The SASEC Integrated Trade Facility Project, the Dhaka Mass Rapid Transit Development Project (Line 5 Southern Route), and a few other projects will also receive funds through the loan pipeline.

Leave a Comment