World Bank agrees to revive scrapped loan to B’desh

Dhaka: The World Bank today agreed to revive a USD 1.2 billion loan to Bangladesh for a major road and rail bridge on a condition that the government implements anti-graft measures for smooth functioning of the project.

“The Bank has agreed that, upon satisfactory implementation of the agreed measures by the Government (against the corruption), and with the support of the Bank’s governing bodies, the Bank will engage anew in the Padma Multipurpose Bridge,” the World Bank said in statement.

It, however, added the global lending agency “remains vigilant to any signs of corruption in the Padma Bridge project, and our determination to take a strong line against wrongdoing will never waver”. The World Bank withdrew a USD 1.2 billion line of credit for the 6.2-km bridge over the Padma River, saying it had “credible evidence” of high-level corruption among Bangladeshi government officials.

Since then Prime Minister Sheikh Hasina’s government pursued a campaign to revive the loan agreement. The government removed a minister from the cabinet and sent a senior adviser to Hasina on leave for their suspected involvement in the “corruption conspiracy”.

The World Bank said “The Government of Bangladesh has now begun to address the evidence of corruption the Bank identified. The World Bank understands that all government employees and officials alleged to have been involved in corrupt acts in connection with the project have been put on leave from Government service until an investigation is completed, and that a full and fair investigation is now underway.”

On June 29, the global lending agency eventually scrapped the deal saying the government did not respond in an excepted manner to their complaint about the “high level corruption conspiracy” involving Bangladeshi officials, executives of a Canadian firm and private individuals.

Finance Minister AMA Muhith two days ago said the premier’s economic affairs adviser Mashiur Rahman was disengaged from the project on corruption allegations as talks were underway in Washington for the revival of the deal.

The Asian Development Bank had pledged a USD 615 million loan for the bridge’s construction while JICA and Islamic Development Bank had also signed agreements with the government to lend USD 400 million and USD 140 million respectively but the WB decision had also forced the co-financers to suspend funding as they worked in a consortium.