Bangladesh gets $300m in World Bank loans for rural economy, COVID resilience

The Bangladesh government and the World Bank have signed a $300 million financing agreement to boost rural economy and build resilience to effects of the COVID-19 pandemic.

The deal is expected to help about 750,000 poor and extreme poor rural people across 20 districts come out of poverty and build resilience to the pandemic and any future shocks.

Through income-generating activities, livelihood and entrepreneurial support, as well as skills development for the poor and extreme poor people, the Resilience, Entrepreneurship and Livelihood Improvement or RELI Project will help boost the rural economy in about 3,200 villages, according to a statement.

Built on the success of the first and second Social Investment Program Projects and on the Nuton Jibon Livelihood Improvement Project, the RELI project will mobilise, develop, and strengthen community organisations, and finance their community plans provide cash transfers and loans for income-generating activities.

“The COVID-19 pandemic has negatively impacted the poor in rural areas particularly women, by limiting their income and economic opportunities,” said Mercy Tembon, World Bank country director for Bangladesh and Bhutan, after the signing of the deal on Sunday.

As much as 90 percent of the beneficiaries will be women.

“The project will also help with health and nutritional awareness. When a woman earns more, her family and the community are better off,” Tembon said.

Further, the project will support rural entrepreneurs and producer groups with market linkages including e-commerce platforms, partnerships with local governments, and promotional activities.

It will also provide skills development training to the unemployed or under-employed youth and returnee migrants to increase their employability.

“The project is aligned with the 8th Five Year Plan and the Bangladesh Delta Plan 2100,” said Fatima Yasmin, secretary of economic relations.

“Through community mobilisation and climate-smart agriculture practices, the project will help rural women withstand any future shocks like the pandemic without falling back to poverty.”

The project will provide training to almost 490,000 people on climate risk, adaptation, and resilience building. It will also build 5,120 climate-resilient small-scale infrastructures.

The credit from the World Bank’s International Development Association has a 30-year term, including a five-year grace period.