Project Signing: US$157 million to Improve Urban Infrastructure and Rural Livelihoods in Bangladesh

August 23, 2010

DHAKA, August 23, 2010: The Government of Bangladesh today signed two credit agreements totaling US$ 157 million for the ‘Empowerment and Livelihood Improvement Project, known as the Notun Jibon Project, and additional financing for the on-going Municipal Services Project.

The US$115 million provided for the Notun Jibon supports the second phase of a 12-15 year community-driven development program focused on Bangladesh’s poorest districts.  It will improve the quality of life and the livelihoods of poor households in rural villages, while helping to build resilience to climate change and natural disasters. 

The second phase will scale up results from the first phase, which included: completion of 1,700 community infrastructure projects as local roads, culverts, bridges; creation of 22,000 women’s savings groups; skill enhancement and job creation for 75,000 vulnerable youth; and skills training and income generation for 30,000 of the poorest and most vulnerable individuals.

‘Our new country strategy to support Bangladesh underscores the importance of scaling up in areas where we see development results’ said Ellen Goldstein, World Bank Country Director for Bangladesh. ‘Evaluation of the first phase demonstrated the cost-effectiveness of community-led infrastructure sub-projects, skills training and income generation with measurable improvements in rural connectivity, economic opportunities and employment among beneficiaries.’    

The first phase benefitted an estimated 3 million people in seven of Bangladesh’s poorest districts.  The second phase will deepen activity in these districts and expand to eight others, reaching an additional 3 million people.

“Both the projects are aligned with the longer-term development goals of Bangladesh as articulated in the Second National Strategy for Accelerated Poverty Reduction (NSAPR-II) and the upcoming Sixth Five Year Plan. The projects would contribute to improvement of essential infrastructure for pro-poor growth while also focus on capacity building in rural areas and of urban local governments.” said Mr. M Musharraf Hossain Bhuiyan, Secretary, Economic Relations Division, Government of Bangladesh.

The $42 million additional funding for the on-going Municipal Services Project is one response to the World Bank’s strategic priority of improving planning and management of the urbanization process in Bangladesh.

Started in 1999, the project has financed basic infrastructure, such as water supply, roads and street lighting in about 130 municipalities, and repaired and rehabilitated flood-damaged infrastructure in  more than 200 towns following the devastating floods of 1998, 2004 and 2007. The additional financing will support infrastructure improvements in around 170 towns and improve financial and management capacity in municipalities.

The agreement was signed at the Economic Relations Division today. Mr. M. Musharraf Hossain Bhuiyan, Secretary, Economic Relations Division and Ms. Ellen Goldstein, World Bank Country Director, signed on behalf of the Government of Bangladesh and the World Bank respectively.

The credit from the International Development Association (IDA), the World Bank’s concessional lending arm, has 40 years to maturity, including a 10-year grace period; and carries a service charge of 0.75 percent.

Media Contacts
In Dhaka
Mehrin A. Mahbub
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In Washington
Mohamad Al-Arief
Tel : (202) 458 4735