The New Nation - Internet Edition

The Bangladesh government yesterday signed a credit agreement worth US$50 million with the International Development Association (IDA) to help restore assets and livelihoods for families affected by cyclone SIDR.

The US$50 million in additional financing for the Social Investment Program Project (SIPP) would support rehabilitation of the cyclone affected families. The additional financing would scale up support to the government in developing effective financing and institutional arrangements to empower the poorest and most vulnerable and improve their access to small scale local infrastructure, assets and livelihoods. SIPP, which has already benefited over 1,000 villages across Bangladesh, was identified as the best instruments for quickly channeling funds to support livelihoods restoration at the cyclone affected areas.

The operations under the additional funding will commence in the first week of August in four upazillas as pilot in the coastal areas. The project will cover 14 most affected upazillas and about 40-50 unions.

The agreement was signed at the Economic Relations Division yesterday morning.

Mohammad Mejbahuddin, Additional Secretary, Economic Relations Division and Xian Zhu, World Bank Country Director, signed on behalf of the Government of Bangladesh and the World Bank.

After the devastating cyclone SIDR, the World Bank offered US$250 million short and medium term support to help the millions of affected people to recover and to strengthen disaster mitigation systems. Already US$ 100 million was quickly disbursed as budget support in the last financial year. Another US$ 100 million support is under preparation for delivery in FY 09.

The credit from the International Development Association (IDA), the World Bank's concessionary arm, has 40 years to maturity, including a 10-year grace period; and carries a service charge of 0.75 per cent.