ADB provides $230 million for flood rehabilitation in Bangladesh

The Asian Development Bank (ADB) has signed agreements with Bangladesh for $230 million in loan to help the rehabilitation and reconstruction efforts in the north-eastern region of the country affected by devastating floods in May–June 2022.

Sharifa Khan, secretary, Economic Relations Division, and Edimon Ginting, ADB country director for Bangladesh, signed the agreements on behalf of Bangladesh and ADB, respectively, said a press release.

The assistance under the Flood Reconstruction Emergency Assistance Project aims to help in the reconstruction, improvement of resilience, and economic recovery of northeastern districts of Brahmanbaria, Habiganj, Kishoreganj, Moulvibazar, Mymensingh, Netrokona, Sherpur, Sunamganj, and Sylhet. Record rainfall in northeastern Bangladesh in May–June 2022 caused massive flooding, especially in the low-lying Haor region, affecting 7.2 million people.

"The project will address the climate change impacts by developing innovative climate-resilient infrastructure under the build-back-better principles in line with the government's national adaptation plan," said Country Director Edimon Ginting.

"It will also help improve living conditions, livelihoods, and climate resilience in the flood-affected northeast region of Bangladesh by reducing flood risks in 79,233 hectares of land; improving climate-resilient irrigation infrastructure and water delivery services in at least 10,000 hectares of land; reconstructing and rehabilitating 757 kilometers (KM) of rural roads, 34 km of rail track, 80 km of river embankment and 11,900 tube wells; and planting 100,000 trees," Ginting added.

In partnership with national and international research institutes, the project will support climate-smart agriculture technologies and livelihood support to the flood-affected people in the socioeconomically underdeveloped Haor region. The improvement in agriculture value chains (crops and fisheries) will enhance food security, nutrition, employment, poverty reduction, and rural livelihoods. 

The project will incorporate safety features in infrastructure designs, particularly for the elderly, women, children, and people with disability. In line with the build-back-better approach, the infrastructure design will consider historical and projected climate scenarios including maximum flood depth and velocity, and temperature and rainfall. The project will also support water management through alternative wetting and drying technology, direct seeded rice, and the use of solar irrigation for climate adaptation and mitigation. 

An additional $1 million technical assistance grant from ADB's Technical Assistance Special Fund will support implementing agencies in building their capacities in climate adaptation and disaster risk management, improving project implementation and monitoring, and strengthening flood risk management and early warning system.

The implementation period of this project is from April 2023 to March 2026.

For the project, ADB will provide an Ordinary Capital Resources (OCR)-Concessional loan of $230 million under Emergency Assistance Loan (EAL).

The rate of interest for the OCR-COL loan is 1% fixed with no other charges. The loan repayment period is 40 years with a grace period of 10 years.