The World Bank (WB)'s Board of ExecutiveDirectors yesterday approved two projects totaling US$900 million to helpBangladesh strengthen fiscal and financial sector policies and improve urbaninfrastructure and management to ensure sustainable and climate-resilientgrowth."Decisive reforms will help Bangladesh sustain growth and strengthenresilience to climate change and other shocks," said Abdoulaye Seck, WorldBank Country Director for Bangladesh and Bhutan."These new financing operations will help Bangladesh in two critical areas--the financial sector and urban management-- to achieve its vision of uppermiddle-income status," he added.The Second Recovery and Resilience Development Policy Credit ($500 million)-the last in a series of two credits-supports fiscal and financial sectorreforms to accelerate sustainable growth and build resilience to futureshocks, including climate change, said a press release.The programme supports the transition from trade taxes to consumption andinc ome taxes, which will help Bangladesh strengthen competitiveness andprepare for LDC graduation.It will help institutionalize the public procurement authority responsiblefor the electronic government procurement (e-GP system), which will cut downthe average e-GP procurement lead time from 70 days to 55 days.It supports stronger banking sector oversight and improved management ofNational Savings Certificates.It will also help improve the efficiency and targeting of cash-based socialprotection programmes and scales up public and private climate adaptation andmitigation investments."A well-functioning financial sector is critical for Bangladesh to increaseinvestment and improve access to finance for those left out of formal bankingsystems," said Bernard Haven, World Bank Senior Economist and Task TeamLeader for the programme."The government has adopted strong macroeconomic reforms to address externalimbalances and a new legislative framework to strengthen the financialsector," Have n added.The financing will help streamline the bank recovery framework, implementinga prompt corrective action framework to address undercapitalized banks.It will also bolster social protection programs, safeguarding the mostvulnerable during economic downturns and natural disasters.The Resilient Urban and Territorial Development Project ($400 million) willhelp improve climate-resilient and gender-responsive urban infrastructure andurban management capacities in seven city clusters along the economiccorridor covering over 950 kilometers of the highway from Cox Bazaar, in thesouth of Bangladesh to Panchagarh, in the north of the country Bangladesh.In 2021, about 38% of the country's population lived in urban areas. Thisnumber is projected to rise to 60 percent by 2050.The trend of urbanization has largely been driven by the rapid growth ofmanufacturing sector jobs in the Dhaka metro area, making Dhaka one of themost densely populated cities in the world.Climate resilient developme nt in secondary cities will help absorb climatemigrants while helping reduce congestion in Dhaka.The project prioritizes coordinated investment in infrastructure and planningacross these cities, ensuring a holistic approach compared to individual cityplans.The project will help provide investments to support the development ofstrategically important corridors and city clusters. It will help createjobs, enhance rural-urban linkages and transition, and strengthen food supplychains, and link to domestic markets and global value chains.It will improve connectivity between the selected cities and surroundingUnion Parishads by improving roads and bus terminals and also create neweconomic opportunities by enhancing facilities for tourism, open spaces, andothers.The infrastructure designs will incorporate the needs of female users andgreen building features including rainwater harvesting. "This will be thefirst in a series of projects helping build resilience to climate change andcreat e new opportunities and jobs in secondary cities through spatiallytargeted investments," said Kwabena Amankwah-Ayeh, World Bank Senior UrbanDevelopment Specialist and Task Team Leader for the project."Developing secondary cities as growth hubs will be critical for thecountry's sustainable growth." Kwabena added.Selected municipalities and city corporations will receive subgrants forinvesting in climate-resilient and gender responsive infrastructure. Theselected cities will be able to increase revenues by 20pc.They will form Town-Level Coordinating Committees, where at least one-thirdof the members will be women.The World Bank was among the first development partners to support Bangladeshfollowing its independence. Since then, the World Bank has committed about$41 billion in grants and interest-free credits to Bangladesh.In recent years, Bangladesh has been among the largest recipients of theWorld Bank's interest-free credits.Source: Bangladesh Sangbad Sangstha
- May 25, 2026
