The Manila-based Asian Development Bank (ADB) will give Bangladesh a loan of $165 million to fund infrastructure projects, the bank said in a statement.
Bangladesh will also mobilise up to $600 million through a Public-Private Infrastructure Development Facility (PPIDF) to finance up to 20 projects, mostly in the energy sector, the ADB said in the statement, received by Reuters on Sunday.
The projects would add at least 900 megawatts to Bangladesh's power generation capacity and would supply electricity to about 100,000 more households through a renewable energy programme, the ADB said.
Bangladesh's public investments in the infrastructure sector have remained stagnant in recent years, accounting for only up to 7 percent of the gross domestic product (GDP). Just 60 percent of its urban households, and 22 percent of rural households, have electricity connections now.
"The facility will improve the infrastructure sector in Bangladesh through increased private sector participation, thereby promoting economic growth and reducing poverty," Peter Marro, Senior Investment Specialist at ADB's South Asia Department, said in the statement.
Of the $165 million, $82 million will help finance large infrastructure projects, $50 million will assist small and medium-sized energy projects and $33 million will go to promote renewable energy. Besides, a $500,000 technical assistance grant will also be provided for training and support, the ADB said.
The PPIDF is an integral part of ADB's sector strategy and complements ADB's parallel initiatives in governance, capital markets development, and promotion of public-private partnerships. The state-owned Infrastructure Development Co Ltd will provide financing of up to 40 percent of each project and a loan repayment period of up to 20 years while the rest will be injected by the private sector. The Islamic Development Bank will also provide $18 million for IDCOL's solar energy programme.
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