World Bank to provide $150m loan for Informal sector employment recovery

The Government of Bangladesh and the World Bank have signed an additional financing agreement and a grant agreement amounting to a $150 million loan and a $0.75 million grant for the implementation of the Recovery and Advancement of Informal Sector Employment (RAISE) Project.

The agreements were signed yesterday (1 February) by Md Shahriar Kader Siddiky, secretary of the Economic Relations Division (ERD), and Jean Pesme, World Bank division director for Bangladesh and Bhutan, according to a press release.

The project is being implemented by the Palli Karma-Sahayak Foundation (PKSF) under the Financial Institutions Division of the Ministry of Finance.

The RAISE Project has been under implementation since 2021 with World Bank support and is scheduled to continue until June 2026. The implementation period for the additional financing will extend until 31 December 2030.

It aims to enhance earning opportunities and employment for low-income urban and rural youth, particularly those affected by the Covid-19 pandemic, by providing targeted services and support.

Under the additional financing package, the International Development Association (IDA) will provide a $150 million concessional loan, while the Early Learning Partnership Multi-Donor Trust Fund (ELP MDTF) will contribute a grant of $0.75 million.

The loan carries an interest rate of 1.5%, a commitment fee of up to 0.50% on the undisbursed balance, and a maturity period of 25 years, including a five-year grace period.

The World Bank remains the largest multilateral development partner of Bangladesh. This financing underscores the strong partnership between Bangladesh and the World Bank.

Currently, World Bank-supported operations in the country span a wide range of sectors, including economic and social development, institutional reforms, infrastructure development, and energy sector advancement.