IDB approves $95.24m loan for rural housing project in Bangladesh

Islamic Development Bank has recently approved a loan of $95.24 million for rural and peri-urban housing finance project in Bangladesh. The approval came at the bank’s 320th meeting held in Jeddah on Sunday. In the meeting, IDB approved a total of $1096.4 million for development projects for its member countries in various sectors such as power generation, water supply and sanitation, industry, housing, communications, agriculture and health as well as a number of educational and health projects for Muslim communities in non-member countries. Earlier on January 1, Finance Minister AMA Muhith approved a proposal from the Finance Division to take the loan from the IDB with a view to constructing multi-storied residential buildings in district towns for protecting crop land, said the ministry officials. According to the proposal, the government has to pay the loan at 3.25% interest rate within 15 years with a grace period of five years. IDB will lend the money to Bangladesh House Building Finance Corporation (HBFC) through the Finance Ministry. Contacted, HBFC Managing Director Debasish Chakrabarty told the Dhaka Tribune on Wednesday, “HBFC would disburse the loan only to the borrowers living outside Dhaka and Chittagong metropolitan areas for construction of multi-storied residential buildings.” He said under the project, a total of 1,046 buildings will be erected to accommodate 47,856 people. The loan would be disbursed under ‘Pallima Scheme’, a newly launched scheme of the corporation. Under the scheme, loans would be distributed to construct 4,050 units in rural areas, 2,825 units in peri-urban areas and 1,101 units for non-resident Bangladeshis (NRBs), said Debasish. He also said one could take loan at best Tk60 lakh while the interest would be 8.5%. “We would take the house building culture to urban, peri-urban and even to those municipality areas which are not under the project.” Debasish added that they would like to provide low-cost home financing for low-income rural people as part of project assistance.