ADB extends loan for food security

1 July 2010, 18:00 PM

Bss, Dhaka

The Asian Development Bank (ADB) extended financial assistance to Bangladesh to grow high-value crops including vegetables, spices and fruits that will boost income for the poor farmers and support the nation's food security. Concessional Asian Development Fund of the ADB sanctioned a loan of 40 million US dollars to support the development of high-value crops in 27 districts in the southwest and northwest of the country, said a press release yesterday. The focus of the project will be on crops with proven market demand, high profitability, and potential for commercialisation, including fruits, vegetables, pulses, spices, cut flowers, potted plants and value-added agro-products. With Bangladesh highly susceptible to extreme weather events due to its low-lying position along the Bay of Bengal, the project will also pilot test climate-resilient varieties of crops in drought and flood-prone areas. Under the project, training in production and post- harvest processing and marketing of high-value crops will be provided to reduce post-harvest losses and improve produce quality. The loan, which will finance 87 percent of the total project cost of 45.8 million US dollar, has a 32-year term with an eight-year grace period. Interest during the grace period is set at 1 percent per annum, rising to 1.5 percent for the rest of the term. The government is extending 5.42 million US dollar, with farm communities extending around $390,000. The Department of Agricultural Extension and Bangladesh Bank are the executing agencies for the project, which is expected to be completed by June 2016.