MAWA, April 28, 2011 – The Government of Bangladesh today signed a credit agreement worth US$ 1.2 billion for the Padma Multipurpose Bridge Project with the International Development Association (IDA), the World Bank’s concessionary arm. The 6.1 km Padma Bridge will connect the isolated south west region to the rest of the country and will have a transformational effect on the lives of 30 million people living in that region.
“Improved connectivity will enhance access to markets and services, accelerating the growth of the country as a whole,” said Honorable Minister, Mr. A.M.A Muhith, Ministry of Finance, Government of Bangladesh. “The Bridge will have far reaching economic and social benefits, including faster growth, new opportunities for the people, enhanced mobility and trade and help control river erosion and local flooding.”
“The Padma Bridge will transform millions of lives in the South-West Region and is a long overdue investment in the development of the country”, said Dr. Ngozi Okonjo-Iweala, Managing Director, World Bank. “The World Bank is happy to be a part of realizing this dream. We appreciate the Government of Bangladesh’s commitment to implement the project with transparency, integrity and highest quality standards. The World Bank is committed to rapid implementation of the operation and we are grateful to our partners, the co-financiers, for joining in this endeavor.”
The Government of Bangladesh and the World Bank have agreed on a jointly developed Governance and Accountability Action Plan for the Padma Bridge Project to facilitate effective use of funds, enhance good governance and prevent the incidence of corruption. The Plan stipulates a range of measures to provide for enhanced transparency and accountability, including a robust right-to-information regime and multiple mechanisms for external scrutiny at key phases of the project, particularly procurement. The Government has appointed a special high-level Project Integrity Advisor independent of implementing entities who will track and report directly to the Prime Minister on all governance issues.
The Padma Bridge will open up new routes for the North Western region of Bangladesh to access Mongla port, now operating at 20% of its capacity. The country’s two sea ports will be connected. The Bridge will enable faster poverty reduction and economic growth for entire country. An estimate suggests that the economic growth will be increased for the South-west region by 1.7% and by 0.6% for the country.
“The Padma Bridge will fulfill the long cherished dream of the people of the South-West Region. This will shorten the journey from most points in the region to Dhaka by 100km, and reduce travel time significantly” said Honorable Minister, Mr. Syed Abul Hossain, Ministry of Communication, Government of Bangladesh.
Beyond Bangladesh, Padma bridge will increase connectivity with other countries. The bridge will establish missing link along the longest corridor under the Asian Highway Network connecting Tokyo to Istanbul. The Asian Highway runs from Kabul to Dhaka, via Lahore, Delhi and Kolkata. Trade to and from Nepal would also directly benefit from the Padma Bridge, offering an alternative to the highly congested port of Kolkata for trade with Nepal.
Mr. M. Musharraf Hossain Bhuiyan, Secretary, Economics Relations Division and Ms. Ellen Goldstein, World Bank Country Director, signed on behalf of the Government of Bangladesh and the World Bank respectively aboard a ship on the Padma River. Honorable Minister, Mr. A.M.A Muhith, Ministry of Finance, Dr. Moshiur Rahman, Economic Advisor to Prime Minister, Honorable Minister, Mr. Syed Abul Hossain, Ministry of Communication and Dr. Ngozi Okonjo-Iweala, Managing Director, The World Bank were present on this occasion.
The credit from the International Development Association (IDA), the World Bank’s concessional lending arm, has 40 years maturity, including a 10-year grace period; and carries a service charge of 0.75 percent.