38625-013: Emergency Flood Damage Rehabilitation Project

Project Data Sheet (PDS): Details


Description

The objective of the Project is to sustain economic development by supporting the Government's efforts to rehabilitate high-priority and essential infrastructure damaged by the 2004 floods in Bangladesh. The Project will focus on priority areas, identified through consultation with the Government, public and private sector, civil society and involve community participation. The Project also includes capacity building and training to strengthen the Government's disaster preparedness through adoption of flood-resistant infrastructure design standards, and preparatory work to enhance early warning systems.

Project Rationale and Linkage to Country/Regional Strategy

The devastating flooding in 2004 caused severe damage to infrastructure and other assets and disrupted economic activities, inflicting heavy losses to agricultural and industrial output and slowed down expansion in services. Based on the joint ADB-World Bank damage and needs assessment, the combined losses to assets and output amounted to at least $2.2 billion, constituting 3.9% of gross domestic product (GDP). The flooding also set back progress achieved in poverty reduction, with the poor and the vulnerable suffering most in terms of losses to crops, livestock, property and housing and reduced income opportunities. While the flood-related damages to small-scale enterprises (SMEs), export-oriented knitwear industry, jute, leather, and frozen food are likely to affect export growth, imports will come under mounting pressures due to sharp rise in post-flood imports of food grains, medicines, and construction materials. The widened current account deficit will deplete foreign exchange reserves, requiring additional assistance to reduce the external financial gap. Current expenditures will exceed the budgeted target for FY2005, with increased expenditures for relief efforts, expansion of food-assisted safety nets, operation and maintenance of infrastructure, assistance to flood- affected farmers for commencing production and manufacturing sector for rehabilitation and grants to dislocated people. The revenue outturn for FY2005 will be lower than expected due to the flood-induced shrinkage in the tax base. Even with diversion of resources by the Government from low-priority development projects to post-flood rehabilitation of infrastructure, there will be a gap in financing needs estimated at $680 to $730 million, depending on improved standards applied during repair and rehabilitation. By providing financing for the most urgently needed components and works, complementing assistance by other financiers, the Project will enable the Government to finance a portion of the overall recovery program, as well as help restore the economic activity essential for recovery of affected areas.

Safeguard Categories

Environment: B
Involuntary Resettlement: B
Indigenous Peoples: C

Summary of Environmental and Social Aspects

The initial environmental examination (IEE) for the entire Project was conducted to determine the degree of likely impacts and describe possible mitigation measures. The Project involves only rehabilitation of previously existing infrastructure. The IEE concluded that it is not likely to generate any significant environmental impacts during the construction and operation periods. The Project is expected to have several environmental benefits, including limiting land errosion and failure of embankments; and reducing health risks. The Project is not anticipated to require land acquisition or involve involuntary resettlement.



Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

Project Data Sheets (PDS)

Timetable

Fact-finding
12 Sep 2004 to 27 Sep 2004

Management Review Meeting
24 Nov 2004

Board Approval
20 Jan 2005

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