The World Bank has offered a Tk2,000-crore assistance fund to address the country’s ongoing flood and natural disaster, official sources have said.
According to an ERD official, WB has made such an offer to address the post-flood disaster in the country.
The global lender is interested in offering this loan in a new way beyond its continuous support provided by IDA every year in Bangladesh.
“It is a new product of World Bank for assistance to people living in flood-affected areas,” ERD Secretary Kazi Shafiqul Azam told the Dhaka Tribune on Tuesday.
The WB proposal has already been sent to different ministries and divisions for their opinion and a discussion will take place thereafter, added the secretary.
According to sources, IDA offers the highest amount of $25 million or equal to 0.5% of Bangladesh’s GDP size.
Under the new proposal, such loan will be available over the course of next three years to combat the rapid losses in the wake of disaster.
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Through the renewal of contract, the fund would be available for another three years after the current term expires and no commitment fee will be charged for this.
Opinions on the WB proposal from the Ministry of Finance, the Ministry of Disaster and Relief and all ministries and departments concerned have been sought.
Under the IDA-17 programme, Bangladesh receives a total of $4.3 billion from 2015 through 2017 while such kind of fund under IDA-18 is likely for 2018-2020 period.
Referring to the importance of this loan, WB said Bangladesh has a financial loss of about $320 billion dollar in flood and cyclone every year, which is equal to 2.1% of the country’s GDP.
According to statistics, the amount of damage caused by natural disaster in Bangladesh from 2000 to 2013 is more than $10 billion in financial value, but the amount of aid, relief and rehabilitation of disaster-affected people in this period is only worth $2 billion dollar.
According to the World Bank, Bangladesh is one of the easiest loan borrowers from IDA with only 0.75 interest rate.