The World Bank will provide US$500.00 million loan to Bangladesh to implement the “Second Bangladesh Green and Climate Resilient DPC Program”.
In this regard, a financing agreement was signed on Saturday between the Bangladesh government and the International Development Association (IDA), soft loan arm of the World Bank.
Md. Shahriar Kader Siddiky, secretary, Economic Relations Division and Abdoulaye Seck, country director, the World Bank, signed the financing agreement on behalf of their respective sides, according to a release issued from the ERD on Su
nday.
The main objective of the programme is to strengthen fiscal and financial sector policies to sustain growth and to enhance resilience to future shocks, including climate change.
Finance Division is the main implementing agency of this program. Other implementing agencies are the Local Government Division, the Bangladesh Bank, the Ministry of Planning, the Ministry of Environment, Forest and Climate Change, the Ministry of Power,Energy & Mineral Resources, the Ministry of Science and Technology, the Health Services Division and the National Board of Revenue.
Out of $500 million loans, $250 million is being taken from World Bank’s IDA-Regular loan. This loan is repayable in 30 years with 5 years grace period. Interest rate is 1.25%, Commitment fee is 0.50% & Service charge is 0.25%. But World Bank waives the commitment fee every year.
Remaining $250 million is being taken from IDA-Shorter Maturity Loan (SUW-SML).
This loan is repayable in12 years with six years grace period. This loan has no interest, service or other charge.
There is only 0.50% commitment fee which is normally waived by World Bank.
The World Bank is the largest development partner of Bangladesh. The World Bank has committed more than $43.00 billion for Bangladesh since its independence.
At present, the World Bank is financing around $17 billion for 52 ongoing projects that cover economic and social development, institutional, health, infrastructure, power, environment and other important sectors.
