Loans for Rohingya projects: Setting a risky precedent?

For the first time since the 2017 Rohingya influx, Bangladesh is seeking loans from global lenders to support development efforts for the refugees and the affected host communities in the country.

The billion-dollar aid package from the World Bank and the Asian Development Bank (ADB) — $535 million in loans and $465 million in grants — will be used to build various infrastructure including healthcare, and to strengthen disaster and climate change resilience.

Dwindling grants for Rohingya projects has forced the government to seek foreign loans. Due to the decline of foreign donations and a consequent budget crunch, not only has the per-head allocation come down, many projects have also been shut down. Fund allocation for Rohingyas has come down to $8 per person per month from the previous $12.

Experts and development activists fear that the situation is spiralling out of control, and the new burden will hurt the nation's already aching economy.

According to a development worker posted in Cox's Bazar, 80% of foreign staff working with the UN agencies have already left the country, while 30% local staff have also been let go. The remaining staffers are counting days before they also lose jobs, the development worker said.

"Infrastructure demands a continuous allocation of budget. Some camps are still  not easily accessible. Also, it is not allowed to erect any concrete building here, so the agencies build bamboo houses, which are fragile and need replacement at a point," he said, asking to remain anonymous. 

According to him, Site Maintenance and Engineering Project (SMEP), the multi-agency partnership between IOM-UNHCR-WFP responsible to address critical infrastructure in the Rohingya response, has stopped their operations in Bangladesh.

"The employment opportunities in the refugee intervention projects have reduced drastically," he added.

As the Rohingya refugee community has outnumbered the host communities in Ukhiya and Teknaf, the locals are uncomfortable with their presence. Rohingyas working in the  farms as cheaper day labourers causes dissatisfaction amongst the local people. However, the donation-based intervention had created job and business opportunities in huge numbers for the locals, preventing an outburst of anger so far.

But uncertainty is rising as the problem is getting bigger every day. 

"The Rohingya population has increased by two to 2.5 lakh than it was in 2017. At the same time, international support for them has decreased in recent times. In other words, the demand has risen by 20-30% while the supply fell by 60%," Dr Nasir Uddin, refugee expert and professor at the Department of Anthropology, Chittagong University, told The Business Standard. 

"For the first three years, the Bangladesh government spent Tk30,000 crore per year in addition to the foreign support, according to a government estimate," he continued.

"Now if we are to allocate a huge amount of money for the refugees, it will lead to a serious budget shortfall. This is why the government has been forced to seek the loans. The reserve crunch is already hurting and Bangladesh has been negotiating loans with the international financial institutions. The Rohingyas have become an ever bigger burden in this situation," the professor said.

Asked if this situation will boost the Rohingya repatriation efforts, the professor said there has been a movement in recent times in the refugee community expressing their willingness to go back to Myanmar. However, the situation in Rakhine has spiralled with the intensifying conflict between the junta government and the The National Unity Government - the 'government' in exile formed out of political parties of the country - along with other rebel groups of Myanmar.

"In terms of security, Myanmar is more unstable now than 2017. So I don't think Rohingyas will be desperate to return under the circumstances," Professor Nasir Uddin said.

So where does the hope lie, if any?

"We are pushing the international community to act in this regard, but what is this 'international community?' It is actually a group of western capitalist countries whose interest lies in serving the corporate interest. Why would they invest so much of their time and money in the Rohingya issue? This has been worsened by the current global affairs such as the Ukraine-Russia war," the Rohingya expert said, clearly frustrated by the developments.

The loan has another serious implication, according to others.

"So far, foreign nations have been donating money for the refugee operations. Taking loans for this purpose sets a risky precedent and the donations may stop coming altogether. Instead, I fear that they might become more interested in giving out loans to Bangladesh," said Shahana Huda Ranjana, Media and Communication Lead of Manusher Jonno Foundation (MJF), a non-government organisation involved in the Rohingya response.

"Rohingyas are not our citizens, why would we take the loan for their welfare which we would have to repay with interest? As a citizen of Bangladesh, I do not support it," Shahana said.

Bangladesh should redouble its efforts in Rohingya repatriation without any further delay, the communications official stressed.

Meanwhile, Transparency International Bangladesh (TIB) has called upon the government to negotiate with the World Bank and ADB to secure grants instead of loans.  

The anti-graft organisation also urged the international community to ensure fair and equitable sharing of the burdens for this persecution-led humanitarian crisis. 

TIB also expressed its concern over the trend of decreasing international grants for the displaced Rohingyas, which it sees as a sign that the international community is shrugging off their responsibility and leaving Bangladesh to bear the brunt of the burden almost all by itself. 

"Bangladesh has already done more than its fair share over the years in hosting and supporting over a million Rohingya refugees who fled persecution in Myanmar," TIB Executive Director Dr Iftekharuzzaman said in a recent statement. 

"Just because Bangladesh opened its borders to host the persecuted Rohingyas, nothing can justify that it will have to endlessly shoulder additional financial burdens which must be borne by collective efforts of the international community. It is doubly disturbing that the decision to seek loan comes at a time when Bangladesh has been struggling hard to cope with its own economic challenges," the statement added.