The Asian Development Bank on Friday approved a $250 million policy-based loan to Bangladesh to help reformation of finance sector in the country.
The loan also aimed at improving the inclusiveness and responsiveness of social development and resilience programme of the country, said a media release on Friday.
Bangladesh has made remarkable progress in reducing poverty rate over the past two decades, said ADB, adding that poverty rate declined from 48.9 per cent in 2000 to 20.5 per cent in 2019.
However, while many people were lifted from extreme poverty line, a considerable number continue to live at a subsistence level, the press release added.
Ongoing Covid-19 pandemic has significantly affected the socioeconomic situation of the country with the decline of country’s gross domestic product to an estimated 5.2 per cent in fiscal year 2020 from 8.2 per cent in fiscal year 2019, ADB said.
“ADB supports the government’s intention to leverage the Covid-19 pandemic as an opportunity to strengthen its social protection programs as an essential means of building the resilience of the poor and supporting an inclusive recovery,” ADB Senior Social Sector Specialist for South Asia Hiroko Uchimura-Shiroishi.
The Strengthening Social Resilience Program will include institutional and policy reforms to address cross-sector issues of social development in Bangladesh.
The programme will expand its outreach to vulnerable women by increasing the coverage of both the old age allowance for women over 62 and the allowance for widowed, single, and destitute women in 150 sub-district units or upazilas.
Other reforms of the programme included promoting the use of mobile financial services and simplifying identification and documentation requirements for opening a bank account and broadening the scope of social protection from mere poverty relief to life cycle social and health responses, including social insurance system.
ADB will also provide a technical assistance grant to support program implementation, policy analyses, and capacity development for social development-related ministries.
The technical assistance is estimated to cost $1.2 million which will be financed on a grant basis by the Japan Fund for Poverty Reduction.