ADB signs $30m sustainability-linked loan with Envoy Textiles, first in Bangladesh
Sustainability-linked loans are performance-based financing tied to specific sustainability targets. For Envoy, the selected indicators include rooftop solar capacity and reductions in greenhouse gas emissions
The Asian Development Bank (ADB) has signed a $30 million sustainability-linked loan facility with Envoy Textiles Limited (Envoy), marking its first such loan in Bangladesh.
The agreement follows ADB's earlier textile manufacturing project with Envoy in 2022.
The proceeds will be used to construct a new automated and energy-efficient spinning unit at Envoy's Jamirdia plant, expand annual yarn production by 4,550 tonnes, install 3.5 MWp of rooftop solar panels, and refinance short-term local working capital loans.
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Sustainability-linked loans are performance-based financing tied to specific sustainability targets. For Envoy, the selected indicators include rooftop solar capacity and reductions in greenhouse gas emissions.
"The ready-made garment industry is a key driver of Bangladesh's economy, accounting for over 80% of the country's total export earnings, and Envoy is the leading denim fabric manufacturer," said ADB Country Director for Bangladesh Hoe Yun Jeong.
"ADB is pleased to support Envoy with its first sustainability-linked loan in Bangladesh. This partnership advances environmental sustainability and industrial modernisation, setting a new standard for the garment sector," he added.
"We are honoured to receive continued support from ADB, whose partnership affirms our commitment to sustainable growth and innovation," said Envoy Chairman Kutubuddin Ahmed.
"This new sustainability-linked loan will enable us to expand our production capacity, invest in renewable energy, and further reduce our environmental footprint," he added.
Envoy produces 54 million yards of denim fabric annually, around 10% of the country's total. It also operates the world's first platinum Leadership in Energy and Environmental Design (LEED)-certified denim manufacturing facility, accredited by the US Green Building Council.
