Japan confirms the biggest ever loan package of US$ 3.167 billion for Bangladesh

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Japanese Ambassador to Bangladesh Ito Naoki and ERD Secretary Fatima Yasmin sign 'exchange of notes"of the 41st Official Development Assistance (ODA) of Japan to Bangladesh on Wednesday

 

On 12 August 2020, H.E. Mr. ITO Naoki, Ambassador of Japan to Bangladesh and Ms. Fatima Yasmin, Secretary, Economic Relations Division, Ministry of Finance signed Exchange of Notes of the 41st Official Development Assistance (ODA) of Japan to Bangladesh, in a statement the Embassy of Japan in Bangladesh said today.

【Japan's 41st, largest ever ODA loan (USD 3.2 billion) to Bangladesh signed today】On 12 August 2020, H.E. Mr. ITO…

Posted by Embassy of Japan in Bangladesh on Wednesday, August 12, 2020

This year’s loan package comprises the assistance of seven projects amounting to JPY 338.247 billion (approximately USD 3.167 billion), the largest ever loan package since its inception in 1974. Based on this agreement between the two counties, Mr. HAYAKAWA Yuho, Chief Representative of JICA Bangladesh Office and Ms. Fatima Yasmin signed a relevant loan agreement. Japan has been the single largest bilateral donor for Bangladesh since 2012, and the total amount of its aid as Yen Loan has reached USD 22 billion (commitment base).

The 41st Exchange of Notes covers the following projects:

  1. Jamuna Railway Bridge Construction Project (II) (loan amount: 89.016 billion yen)
  2. Hazrat Shahjalal International Airport Expansion Project (II) (loan amount: 80 billion yen)
  3. Dhaka Mass Rapid Transit Development Project (IV) (loan amount: 72.194 billion yen)
  4. Dhaka Mass Rapid Transit Development Project (Line 5 Northern Route) (I) (loan amount: 55.696 billion yen)
  5. Chattogram – Cox’s Bazar Highway Improvement Project (E/S) (loan amount: 1.906 billion yen)
  6. Food Value Chain Improvement Project (loan amount: 11.218 billion yen)
  7. Urban Development and City Governance Project (loan amount: 28.217 billion yen)
  • Interest Rate: 0.65 % per annum (The part concerning payments to consultants: 0.01% per annum)
  • Repayment period: Twenty years after the grace period of ten years

For detail, please see the list at the bottom.

Up to the present, the government of Japan has provided approximately USD 13 million as the emergency support to tackle COVID-19 in Bangladesh through international organizations,  as well as provided PPE to hospitals through JICA. Additionally, on 16th July Japan and Bangladesh signed the Exchange of Notes on Japanese Grant aid “Economic and Social Development Programme”(approximately USD 10 million) for the medical equipment including CT Scanner, X-ray Machine. These aids focused on the medical and health sectors currently combating the novel coronavirus.

On 5 August 2020, both countries signed Exchange of Notes of the COVID-19 Crisis Response Emergency Support Loan (approximately USD 331 million), which is the first budget support from Japan to Bangladesh. The purpose of the financial assistance is to provide funding for additional financial expenditure by the Government of Bangladesh to implement the economic stimulus package.
Japan will continue to extend its support for the development of Bangladesh as the country is on its way to achieve the highest growth in Asia in this decade of the century.

Summary of each project

(1) Jamuna Railway Bridge Construction Project (II)
(a) Objective and Summary
The objective of the project is to improve the capacity and safety of transportation by constructing a dedicated railway bridge over the River Jamuna in parallel to the existing Bangabandhu Bridge (Jamuna Multipurpose Bridge), thereby contributing to an efficient logistic and passenger network within the country and with neighboring countries. This project will contribute to the achievement of SDGs Goal 9.

(b) Executing Agency
Bangladesh Railway
Address: Railbhaban, 16 Abdul Gani Road Dhaka-1000, Bangladesh
Phone: +880-2-9561200, FAX: +880-2-9565734

(c) Planned Implementation Schedule
1. Completion of project: March 2024 – when the facilities are put into service
2. Issuing of letters of invitation for consulting services (including construction supervision): Already hired
3. Tender announcement of initial procurement package for international competitive bidding on project construction: Already contracted

(2) Hazrat Shahjalal International Airport Expansion Project (II)
(a) Objective and Summary
The objective of the project is to meet future demand for air transportation and to improve airport capacity, convenience and safety, by constructing Terminal 3, an international passenger terminal, cargo terminals and other infrastructure and facilities at the Hazrat Shahjalal International Airport in Dhaka, thereby contributing to further economic growth in Bangladesh. This project will contribute to the achievement of SDGs Goal 9.

(b) Executing Agency
Civil Aviation Authority, Bangladesh, Ministry of Civil Aviation and Tourism
Address: Kurmitola, Dhaka-1229, Bangladesh
Phone: +880-2-8901400, FAX: +880-2-8901411

(c) Planned Implementation Schedule
1. Completion of project: April 2024 – when the facilities are put into service
2. Issuing of letters of invitation for consulting services (including construction supervision): Already hired
3. Tender announcement of initial procurement package for international competitive bidding on project construction: Already contracted

(3) Dhaka Mass Rapid Transit Development Project (IV)
(a) Objective and Summary
The objective of the project is to alleviate traffic congestion and mitigate air pollution in Dhaka City by constructing a mass rapid transit system, thereby contributing to regional economic development and improving urban environment. This project will contribute to the achievement of SDGs Goals 9 and 11.

(b) Executing Agency
Dhaka Mass Transit Company Limited
Address: 71-72 Old Elephant Road, Eskaton Garden, Dhaka-1000, Bangladesh
Phone: +880-2-55138099, FAX: +880-2-9353507
(c) Planned Implementation Schedule
1. Completion of project: December 2022 – when the facilities are put into service
2. Issuing of letters of invitation for consulting services (including detailed design work): Already hired
3. Tender announcement of initial procurement package for international competitive bidding on project construction: Already contracted

(4) Dhaka Mass Rapid Transit Development Project (Line 5 Northern Route) (I)
(a) Objective and Summary
The objective of the project is to reduce the traffic congestion in Dhaka City and adjoining areas by constructing a mass rapid transit system, thereby contributing to the economic growth and improving the urban environment in Bangladesh. This project will contribute to the achievement of SDGs Goals 9 and 11.

(b) Executing Agency
Dhaka Mass Transit Company Limited
Address: 71-72 Old Elephant Road, Eskaton Garden, Dhaka-1000, Bangladesh
Phone: +880-2-55138099, FAX: +880-2-9353507

(c) Planned Implementation Schedule
1. Completion of project: November 2029– when the facilities are put into service
2. Issuing of letters of invitation for consulting services (including detailed design work): Already hired
3. Tender announcement of initial procurement package for international competitive bidding on project construction:
Procurement package title: Depot package (soil improvement and land development)
Release date: Second half of 2021

(5) Chattogram – Cox’s Bazar Highway Improvement Project (E/S)
(a) Objective and Summary
The objective of the project is to achieve smooth cargo transportation between Matarbari Port and Chattogram by improving roads at congested town areas along National Highway 1, thereby contributing to improvement of logistics in Bangladesh and to the economic growth of the surrounding area. This project will contribute to the achievement of SDGs Goals 3 and 9.

(b) Executing Agency
Roads and Highways Department, Ministry of Road Transport and Bridges
Address: Sarak Bhaban, Tejgaon, Dhaka-1208, Bangladesh
Phone: +880-2-8879299, FAX: +880-2-8879199

(c) Planned Implementation Schedule
1. Completion of project: September 2023– with completion of the consulting services
2. Issuing of letters of invitation for the consulting services (including detailed design work): Second half of 2020

(6) Food Value Chain Improvement Project
(a) Objective and Summary
The objective of the project is to improve credit access for agribusinesses and food processing industries, and to enhance their capacity for business development, food processing, and food safety by providing concessional financing and technical assistance, thereby contributing to the improvement of food value chains in Bangladesh. This project will contribute to the achievement of SDGs Goals 1, 2, and 8.
(b) Executing Agency
Bangladesh Infrastructure Finance Fund Limited
Address: Borak Unique Heights, Level-3,117 Kazi Nazrul Islam Avenue, Eskaton Garden, Dhaka-1217, Bangladesh
Phone: +880-2-8333238-9, FAX: +880-2-9348518

(c) Planned Implementation Schedule
1. Completion of project: September 2026– with completion of the loan disbursement
2. Issuing of letters of invitation for the consulting services (including project management support): July 2020
3. Tender announcement of initial procurement package for international competitive bidding on project construction: No procurement for construction is scheduled for this project

(7) Urban Development and City Governance Project
(a) Objective and Summary
The objective of the project is to improve urban functioning by improving urban infrastructure and strengthening city governance related to infrastructure development in the target cities, thereby contributing to economic growth, improvement of living conditions and sustainable cities. This project will contribute to the achievement of SDGs Goal 11.

(b) Executing Agency
Local Government Engineering Department
Address: Bhaban, Agargaon, Shere Bangla Nagar, Dhaka-1207, Bangladesh
Phone: +880-2-9124027, FAX: +880-2-9110512

(c) Planned Implementation Schedule
1. Completion of project: June 2026– when all subprojects are placed in service
2. Issuing of letters of invitation for the consulting services (including project management support): June 2020 (Already sent)
3. Tender announcement of initial procurement package for international competitive bidding on project construction: No procurement for construction is scheduled for this project


Terms and amounts of loans

Project Name

Amount (million yen) Project Interest rate (Annual) Consulting services Interest rate (Annual) Repayment period (years) Grace period (years)

Procurement

Jamuna Railway Bridge Construction Project (II) 89,016 0.65 0.01 30 10 General untied
Hazrat Shahjalal International Airport Expansion Project (II) 80,000 0.65 0.01 30 10 General untied
Dhaka Mass Rapid Transit Development Project (IV) 72,194 0.65 0.01 30 10 General untied
Dhaka Mass Rapid Transit Development Project (Line 5 Northern Route) (I) 55,696 0.65 0.01 30 10 General untied
Chattogram – Cox’s Bazar Highway Improvement Project (E/S) 1,906 0.01 30 10 General untied
Food Value Chain Improvement Project 11,218 0.65 0.01 30 10 General untied
Urban Development and City Governance Project 28,217 0.65 0.01 30 10 General untied

 

 

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