World Bank backs Bangladesh with energy and clean air investment
The World Bank's Board of Executive Directors has approved two projects totalling $640 million to help Bangladesh improve gas supply security and tackle urban air pollution, both of which are critical for sustained economic growth and public health.
"Enhancing energy security and air quality are critical economic and development priorities for Bangladesh," said Gayle Martin, World Bank Interim Country Director for Bangladesh. "By addressing the root causes of gas supply constraints and urban air pollution, these projects will boost productivity, improve livelihoods and support job creation."
The $350 million Energy Sector Security Enhancement Project will strengthen Bangladesh's gas supply system by supporting Petrobangla in securing cost-effective financing to import Liquefied Natural Gas (LNG). Backed by an IDA guarantee, the project aims to mobilise up to $2.1 billion in private capital over seven years, reducing reliance on expensive spot market imports.
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LNG now accounts for over a quarter of the country's gas consumption, and supply shortages pose a significant challenge—especially for the power sector, which consumes around 42% of the total gas. The project will provide payment security and working capital solutions to support long-term LNG import contracts, thereby contributing to the reliable supply of electricity for industries and households.
"This project will help secure affordable gas supply and support economic resilience," said Olayinka Bisiriyu Edebiri, World Bank Senior Energy Specialist and Task Team Leader.
The $290 million Bangladesh Clean Air Project will adopt a comprehensive approach to air quality management, addressing one of the country's deadliest environmental threats. In 2019, air pollution was responsible for over 159,000 premature deaths, resulting in an estimated 8.3% loss of GDP.
The project will strengthen the Department of Environment's air monitoring network, introduce real-time emissions tracking for industries, and support data transparency and enforcement of pollution limits. It will also deploy 400 zero-emission electric buses, replace old diesel fleets, and upgrade or build Vehicle Inspection Centres and mobile emissions testing units.
"This project is part of a long-term strategy to improve air quality," said Ana Luisa Gomes Lima, World Bank Lead Environment Specialist. "It will also support regional cooperation and data sharing to address cross-border air pollution."
