ADB signs $50m deal to finance PPP infrastructure projects

The Asian Development Bank (ADB) will provide a $50 million loan to promote, fund, and implement public-private partnership (PPP) infrastructure projects in Bangladesh.

The development agency signed an agreement with the government on Thursday, according to a press release issued by the Bangladesh Residence Mission of the ADB.

Fatima Yasmin, secretary to the Economic Relations Division (ERD) and Manmohan Parkash, country director of the ADB virtually signed the loan agreement on behalf of Bangladesh and ADB respectively. 

S M Anisuzzaman, chief executive officer at the Bangladesh Infrastructure Finance Fund Limited (BIFFL) signed the project agreement. 

The fund, equivalent to Tk424.23 crore, would be spent to implement "Strengthening Bangladesh Infrastructure Finance Fund Limited Project" of the BIFFL. 

The ADB assistance will help implement PPP infrastructure subprojects developed by government agencies, said the release. 

The financial intermediary loan will strengthen the capacity of the BIFFL, established by the government, to provide long-term local-currency debt financing to infrastructure projects. 

Manmohan Parkash of the ADB said the project will strengthen the BIFFL's capacity to mobilise private investments, develop infrastructure projects and create jobs, which will accelerate the economic recovery process after the Covid-19 pandemic. 

He also said the project will generate about 3,000 jobs in PPP projects supported by the BIFFL by 2024 and help to implement PPP infrastructure subprojects developed by government agencies.

In addition to catalysing greater private sector commercial infrastructure financing and investment, the project will also help the rollout of the government's PPP strategy, he added. 

The project, with the financial support of the ADB, will provide long-term local currency financing for qualified PPP infrastructure subprojects said the release and added, "ADB has been a long-standing partner to support BIFFL to promote PPP program and develop its pipeline of projects." 

The ADB has also assisted the government to develop the PPP Act, set up the PPP office, and an institutional framework for PPPs in addition to supporting priority sectors of Bangladesh as a transaction advisor.

 A $650,000 technical assistance grant from ADB's Financial Sector Development Partnership Special Fund will support the BIFFL to review and update its corporate strategy, as well as assess and improve its capacity to manage environmental and social safeguards, and project implementation, said ADB officials.