ADB signs $ 125m loan to help BD municipalities

The Asian Development Bank (ADB) and the Bangladeshi government Wednesday signed an agreement for a 125 million U.S. dollars loan to improve services and governance in pourashavas (municipalities), making them more livable and attractive, and helping to ease population pressures in major cities.

adb1Mohammad Mejbahuddin, secretary of Bangladesh’s Economic Relations Division (ERD), and Kazuhiko Higuchi, country director for ADB’s Bangladesh Resident Mission, signed the agreement on behalf of their respective sides at a ceremony in Dhaka.

“Bangladesh needs to develop livable district towns with well- managed quality infrastructure to reduce overcrowding in big cities,” said Higuchi, reports Xinhua.

“ADB is pleased to help achieve this goal of creating model towns with proper planning, improved governance and infrastructure, and other services.”

The Third Urban Governance and Infrastructure Improvement Sector Project builds on successes and lessons from previous projects that focused on improvements in infrastructure, governance, and services, said the Manila-based lender in a statement.

It said the new project will provide assistance to 30 pourahsavas with a total population of 2.2 million, including 20 district headquarters towns. These administrative, trade and economic centers, and transportation and distribution hubs, are crucial for more balanced development in Bangladesh, it added.

According to the statement, the project will help roads, drainage and sanitation systems, piped water supplies, and solid waste collection and disposal. It will also strengthen the ability of municipalities to carry out urban planning, financial management, and service delivery, said the statement.

It said some of the expected benefits will include reduced travel time and cost savings from better roads, health improvements from piped water and solid waste collection, and more citizen participation—including by women and poor and marginalized groups—in governance and the provision of basic services.

Reflecting lessons from previous ADB project assistance, it said the target pourashavas will be eligible for additional phased funding support as they meet performance-based targets linked to governance reforms.

Many pourashavas suffer from weak oversight and are struggling to provide citizens with key services, it said, adding that ADB has already been providing support for improved services under an urban governance improvement action program.

In addition to ADB’s loan, OPEC Fund for International Development will provide co-financing of 40 million U.S. dollars alongside government and pourashava counterpart support of 71 million U.S. dollars, for a total project cost of 236 million U.S. dollars.

The project is expected to be completed in 2020.

The Local Government Engineering Department and Department of Public Health Engineering under the Local Government Division will be responsible for implementation of the project. Participating pourashavas will prepare their development plans and implement sub- projects in consultation with a broad-based citizen forum known as town level coordination committee.