Economic Relations Division Secretary Kazi Shofiqul Azam and Jyotsana Varma, principal country specialist of ADB, signed the loan agreement in Dhaka on Wednesday.
“This project, which is closely aligned with Bangladesh’s Seventh Five Year Plan, will provide efficient, safe and environmentally-friendly railway transport,” Varma said in a statement.
“The project design will integrate features that are friendly to the elderly, women, children, and people with disabilities.”
The new rail link, which opens in 2022, aims to transport 2.9 million passengers annually between Chittagong and Cox's Bazar by 2025.
The fund is the first part of $1.5 billion ADB loans for the SASEC Chittagong-Cox’s Bazar Railway Project.
The first tranche will finance 20 percent of the progress toward constructing 102km of new railway line between Chittagong and Cox's Bazar.
Chittagong-Cox’s Bazar Railway forms part of the Trans-Asia Railway network, an initiative led by the United Nations, aiming to provide seamless rail links between Asia and Europe to better connect people and markets.