Govt, JICA sign $1.14b loan deal for 2 projects

Japan will provide a $1.14 billion loan under the 43rd ODA (official development assistance) Loan Package for the 2nd tranche of the Dhaka Mass Rapid Transit Development Project (MRT Line 5, Northern Route) and Southern Chattogram Regional Development Project.

In this regard, the Economic Relations Division (ERD) and Japan International Corporation Agency (JICA) on Tuesday signed a loan agreement through a virtual signing ceremony, read a press release. 

ERD Secretary Fatima Yasmin, The Ambassador of Japan in Bangladesh ITO Naoki, and JICA Bangladesh Office in Dhaka Chief Representative Yuho Hayakawa have signed the “Loan Agreements” on behalf of their respective governments, the release added.

JICA will provide 16.58 billion Japanese Yen under the 43 ODA loan package, which is equivalent to Tk 11,400 crore, or $ 1.14 billion. 

Of the amount, 1,33,399 million yen (Tk 9,160 crore) was for the second tranche of the Dhaka Mass Rapid Transit Development Project (Line-5 Northern Route) and 32,462 million yen (Tk 2,366.4 crore) for the Southern Chattogram Regional Development project.

Underground metro rail to alleviate congestion

A 20km metro rail line will be constructed under the Dhaka Mass Rapid Transit Development Project (Line-5: Northern Route). There will be a 6.5km elevated metro rail from Hemayetpur to Aminbazar and a 13.5km underground metro rail from Aminbazar to Bhatara.

The project objective is to alleviate traffic congestion and mitigate air pollution in Dhaka city by constructing the underground metro rail.

Earlier, the project received the Executive Committee of the National Economic Council (ECNEC) approval in September 2019.

The total cost of the project is estimated at Tk 41,238 crore, of which Tk 29,117 crore will come from JICA. Dhaka Mass Transit Company Limited (DMTCL) under Road Transport and Highways Division will implement the project. The project is expected to be completed by December 2028.

In 2020, JICA had already provided Tk 4,528 crore for the project in the first tranche. Now, JICA will provide the second tranche of the loan.

The implementing agency DMTCL has completed the feasibility study and basic design for MRT-5. Conducting various surveys, detailed design, and land acquisition is now ongoing. 

The detailed design is 51.60 per cent completed, according to the DMTCL.

Land acquisition is 60 per cent completed for the first east-west MRT corridor of Dhaka being constructed on this route.

Southern Chattogram Regional Development Project

Aside from the metro rail project, JICA will also provide loans to improve the standard of living for residents of Chattogram, Cox’s Bazar and Bandarban districts through infrastructure development under the Southern Chattogram Regional Development Project.

The project will be implemented at Moheshkhali, Chakoria and Teknaf municipalities and Moheshkhali, Chakoria, Teknaf, Ukhiya and Cox’s Bazar Sadar upazila. 

The Local Government Engineering Department (LGED) under the Local Government Division will implement the project by 2028.

The rate of interest of this loan will be 0.95 per cent, and the loan would have to be repaid within 30 years.