World Bank revives funding after Hasina government fulfils its demands

World Bank revives funding after Hasina government fulfils its demands

After months of bitter controversy compounded by suspense and wrangles, the World Bank has finally decided to revive its funding for the $2.9 billion Padma Bridge — a dream project for Bangladesh

The decision was formally announced by the world’s biggest lending agency’s Board meeting in Washington on Friday .

The World Bank cancelled its $1.2 billion credit of the $2.9 billion project on June 29 this year over allegations of corruption — repeatedly denied by Bangladeshi authorities . Though the Bank had not released the funds , it remained rigid on not reviving the loan till the Sheikh Hasina government agreed to its conditions .

The Bank listed four conditions for loan revival — removal of Communications Minister Syed Abul Hossain; sending Prime Minister’s Economic Affairs Adviser Dr. Mashiur Rahman; and Bridge Division Secretary Mosharraf Hossain Bhuiyan on leave; and allowing the bank’s consultants to work with the Bangladesh Anti-Corruption Bureau (ACC) to probe onto the allegations of corruption.

Displeased with WB’s decision to cancel the loan, the government levelled allegation against the Bank of “letting down” the country. The ruling party also found presence of politically motivated “lobbyists” and said they had tried to block the important development project.

However, the government finally removed the Mr. Hossain; sent Mr. Bhuiyan on leave; and agreed to allow the bank’s consultants to work with the ACC. The government also agreed to disengage Dr. Rahman, facilitating the ultimate revival of the loan. Both Mr. Hossain and Dr. Rahman have repeatedly denied their involvement in the charges. They have also wanted the World Bank to make its allegations public, which it has not yet done.

The allegations gave Ms. Hasina’s government jitters as it braced for elections to be held late next year. On the one hand, government’s rivals got opportunity to campaign against it; on the other, the government found it difficult find alternate sources of funding. The situation turned more difficult once the Asian development Bank (ADB); Japan International Cooperation Agency (JICA); and Islamic Development Bank (IDB) decided to put their funding on hold following WB’s withdrawal.

The 6.15-km bridge on the river Padma is to connect south-western Bangladesh, involving 19 districts and the capital — enhancing their access to markets; improving services; and accelerating growth.

While reviving the loan, a World Bank statement said, it will remain “vigilant to any signs of corruption in the Padma bridge project….”.The bank, however, admitted that “ if implemented properly, the bridge has the potential to deliver remarkable benefits to the people of Bangladesh, who deserve transparent use of public money, clean implementation of the project and a high-quality bridge to spur growth and development for years to come.”

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