Disbursal in Japan-funded projects sees 56% progress despite pandemic

Despite pandemic-induced obstacles, the Japan International Cooperation Agency (Jica) disbursed $1,083 million in its loan-assisted projects for Bangladesh between April and September this year, achieving 56% of the target.

However, disbursements in 14 out of 31 projects have fallen short of the target, according to the Economic Relations Division (ERD).

In the current Japanese financial year (April 2020-March 2021), the target of disbursement from Jica funding has been set at $1,936 million.

ERD officials said fund disbursement has increased as the Japanese government released its promised budget support, amounting to $320 million, to help Bangladesh cope with Covid-19.

At a high-level portfolio review meeting on Jica's Official Development Assistance (ODA) loan financed projects on 18 October 2020, ERD Secretary Fatima Yasmin thanked the project authorities for achieving the disbursement target amid the pandemic and requested them to expedite the project implementation process to enhance disbursements.

According to the ERD, nine out of 31 projects witnessed no progress in disbursement in the first six months of the Japanese fiscal year.

In the six months, the Foreign Direct Investment Promotion Project, which commenced in December 2018, failed to utilise any fund from Jica.

Four projects – Matarbari Port Development, Energy Efficiency and Conservation Promotion, Disaster Risk Management Enhancement, and Health Services Strengthening – also saw no expenses from the Jica fund until September.

Utilisation of Japanese funds in four other projects stood at only 1% to 10% during the period.

Only 3% of the foreign fund could be spent on the Maternal, Neonatal and Child Health (MNCH) and Health System Improvement projects.

The Chattogram City Outer Road and the Dhaka Mass Rapid Transit Development projects have already achieved 100% of their disbursement targets set for the six months.

The Jamuna Railway Bridge Construction project witnessed a utilisation of 99% of the Jica fund.

In August, Jica signed multiple loan agreements amounting to around $3.61 billion Japanese Yen, including ¥35 billion in budget support.

In the first three months of Bangladesh's current fiscal year, Jica disbursed $555 million in projects it is funding, which was the highest amount from any global lenders in the period.

In the meantime, the ERD secretary said Jica has requested the government of Bangladesh to undertake health safety measures according to the guidelines set by the Directorate General of Health Services and other international agencies, and develop testing and medical facilities.

Some projects, such as Mass Rapid Transit line-6 (MRT-6), have already arranged field medical facilities for their project staff and workers, while some small project authorities have opined that similar arrangements are not feasible for them.