A loan agreement was signed on Tuesday under which South Korea would provide $47 million soft loan to Bangladesh for the “Bhandal Jhuri Water Supply Project”, Chattogram .
The agreement on additional soft loan was signed between Bangladesh and Korea through a cross signing process.
Md. Shahriar Kader Siddiky, Wing Chief (Asia, JEC and F&F), Economic Relations Division, and Kim Tae-soo, Executive Director, the Export-Import Bank of Korea (Government Agency for the EDCF) signed this loan agreement on behalf of their respective governments, said an ERD press release.
The main objectives of this project are to provide safe water for domestic and non-domestic use by developing water supply system at the left bank of the river Karnaphuli to secure sustainable source of water and improve the livelihood and thus promote economic development through provision of safe drinking water.
Since 1993, Korean Government Agency, Korea Exim bank has been providing soft loan for socio economic infrastructure development and expansion of information technology in Bangladesh.
Under the Local Government Division, Chattogram Water Supply and Sewerage Authority (CWASA) is implementing “Bhandal Jhuri Water Supply Project-Supplementary Loan” project through Economic Development Cooperation Fund( EDCF), Korea.
The initial size of the funding from Korea for this project was $97 million. With this additional financing, total foreign assistance for this project will increase to $137 million. After the initiation of ERD, the Korean government has responded quickly for supporting this project through “Bhandal Jhuri Water Supply Project-Supplementary Loan” with an amount of $47.00 million.
This amount will be disbursed within 30 June, 2023 by the Korean Eximbank.
“Bhandal Jhuri Water Supply Project-Supplementary Loan” loan is a soft loan. The rate of interest under the loan is 0.01 % and maturity period is 40 years including a grace period of 15 years.