$20 Million Loan to Help Improve Flood Management and Irrigation in Southwest Bangladesh

Manila, Nov 30, 2005 (ABN Newswire) - Asia Development Bank ("ADB") will help enhance the livelihood of the rural population in the southwest areas of Bangladesh through a US$20 million loan approved to help improve weak flood control and drainage/irrigation (FCD/I) schemes.

In consultation with various stakeholders, the project will conduct intensive analyses of local water management problems and associated development constraints, as well as feasibility assessments, and then prepare and implement integrated water management plans that will improve and sustain the performance of selected FCD/I schemes.

In implementing the plans, water management associations composed of stakeholders will be formed and trained to take on key roles in all program delivery decisions and sustainable operation and maintenance of local water infrastructure. They will also monitor the civil works to be conducted under the project while implementing relatively minor works on their own.

The project will also help deliver agriculture and fishery support services to the rural population in the project area focusing on the poorest people, and strengthen the institutional capacities of the supporting agencies to manage the overall process, including the operation and maintenance of the main water infrastructure.

The project will cover 100,000 hectares of FCD/I schemes in the southwest areas and benefit about 800,000 among the rural population, most of whom are poor.

"The effective management of water is critical to address pervasive rural poverty problems in Bangladesh," says Kenichi Yokoyama, an ADB Senior Water Resources Specialist.

"Given the complexity of the task due to fairly diverse and complex stakeholder interests and vulnerable natural ecosystems, it is paramount to plan, develop, and manage water resources in a strategic and integrated manner while mobilizing and empowering the stakeholders."

While Bangladesh has established a large number of FCD/I infrastructures, their performance remains weak due to lack of effective participatory management systems. Within the country, the southwest areas face the most acute problems due to annual flooding, and in particular reduced dry-season inflow and associated social and environmental hardships.

Because of the area's susceptibility to flooding and slower expansion of irrigation, its agricultural productivity is lagging behind the national average. This area is home to 28.6 million people, over half of which is poor.

"Improved water management is critically needed in this region of the country," adds Mr. Yokoyama.

ADB's loan, which covers 46% of the project cost, comes from its concessional Asian Development Fund. The loan carries a 32-year term, including a grace period of 8 years, and an interest charge of 1% per annum during the grace period and 1.5% per annum thereafter.

The Government of Netherlands will cofinance $12.5 million of the project's estimated total cost of $43.4 million, and the Government of Bangladesh will shoulder the balance of $10.9 million.

The Bangladesh Water Development Board, under the Ministry of Water Resources, is the executing agency for the project, which is due for completion in June 2013.

The ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through pro-poor sustainable economic growth, social development, and good governance. Established in 1966, it is owned by 64 members, with 46 from the region. In 2004, it approved loans and technical assistance totaling $5.3 billion and $196.6 million, respectively.