Bangladesh : Sustainable Projects
ADB will provide a 5-year senior unsecured term loan to BRAC Bank of up to $30 million. The proceeds will be used to finance socially and environmentally sustainable projects, which include (i) the construction or expansion of RMG factories that meet the high structural, fire, and electrical safety standards required by the accord or the alliance; and (ii) improvement of existing factories to meet any of the above standards. The loan will also fund construction of wastewater and ETPs in the industry sector, primarily in the textile and garment industry.
Project Details
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Project Officer
Doukidis, Doukas
Private Sector Operations Department
Request for information -
Country/Economy
Bangladesh -
Modality
-
Sector
- Finance
| Project Name | Sustainable Projects | |||||
| Project Number | 49074-001 | |||||
| Borrower / Company | BRAC BANK LIMITED |
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| Country / Economy | Bangladesh |
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| Location | Nation-wide | |||||
| Type or Modality of Assistance |
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| Strategic Agendas | Environmentally sustainable growth Inclusive economic growth |
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| Drivers of Change | Private sector development |
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| Sector / Subsector | Finance / Finance sector development |
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| Gender | Effective gender mainstreaming | |||||
| Responsible ADB Department | Private Sector Operations Department | |||||
| Responsible ADB Division | Portfolio Management Division, PSOD | |||||
| Responsible ADB Officer | Doukidis, Doukas | |||||
| Project Sponsor(s) | BRAC BANK LIMITED |
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| Description | ADB will provide a 5-year senior unsecured term loan to BRAC Bank of up to $30 million. The proceeds will be used to finance socially and environmentally sustainable projects, which include (i) the construction or expansion of RMG factories that meet the high structural, fire, and electrical safety standards required by the accord or the alliance; and (ii) improvement of existing factories to meet any of the above standards. The loan will also fund construction of wastewater and ETPs in the industry sector, primarily in the textile and garment industry. | |||||
| Objectives and Scope | The objective of the proposed project is to (i) enhance health and safety standards of garment industry in Bangladesh; (ii) promote finance sector development; (iii) enhance environmental standards in the industry sector. The project will finance socially and environmentally sustainable projects, which include (i) the construction or expansion of RMG factories that meet the high structural, fire, and electrical safety standards required by the accord or the alliance; and (ii) improvement of existing factories to meet any of the above standards. The loan will also fund construction of wastewater and ETPs in the industry sector, primarily in the textile and garment industry. | |||||
| Status of Development Objectives | On track in meeting most of its development objectives. | |||||
| Status of Operation/Construction | On-going. | |||||
| Linkage to Country/Regional Strategy | the Mid-Term Review of Strategy 2020, ADB aims to strengthen its support for the finance sector by supporting the development of financial infrastructure, institutions, and products and services. The project supports three priorities identified by the mid-term review of Strategy 2020 including (i) poverty reduction and inclusive economic growth; (ii) environment and climate change; and (iii) private sector development and operations The project is aligned with the country partnership strategy (CPS) for Bangladesh for 2011-2015, which prioritizes private sector development to accelerate growth by developing the finance sector with an emphasis on clean energy, infrastructure finance and credit for SMEs. The CPS also notes that environmental considerations should be integrated into sector interventions. By financing wastewater treatment plants in industrial sector, the proposed project is in line with ADB's Water Operational Plan, which identified wastewater management services as one of the key elements of ADB's operations in the water sector. |
| Safeguard Categories | |
|---|---|
| Environment | FI |
| Involuntary Resettlement | FI |
| Indigenous Peoples | FI |
| Summary of Environmental and Social Aspects | |
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| Environmental Aspects | The borrower will be prohibited from using the proceeds of the ADB loan to finance projects that are category A under the Safeguard Policy Statement. The borrower will update its existing ESMS to ADB satisfaction before the first disbursement of the proposed loan. BRAC Bank will be required to increase its existing staff capacity to effectively carry out both the assessment and oversight. The enhanced screening process covers (i) fire safety aspects, including verification of accord and/or alliance corrective action plans, and screening out high risk factories; and (ii) environmental and social aspects, which include review of the social and labor audits conducted by the factories' buyers and compliance with local environmental regulations. Subprojects having high risk environment and safety issues will be excluded from financing. BRAC will review government certification, screen and monitor subprojects to ensure compliance with the national legislations, including those related to wastewater treatment plants and effluent treatment plants. |
| Involuntary Resettlement | The proposed ADB funded sub-loans of BRAC Bank will support mainly the construction or expansion of textile plants and improvement of existing plants to meet standard of fire and building safety which are likely to have minor impacts on involuntary resettlement. |
| Indigenous Peoples | The project is not expected to entail any significant impact on indigenous peoples. |
| Stakeholder Communication, Participation, and Consultation | Potential stakeholders include bank staff and their borrowers, national and local government, regulatory agencies, and the project beneficiaries (employees of textile factories, sustainable projects, including women). Consultation meetings were conducted by the bank with the relevant stakeholders, including the poor and vulnerable groups at the factories and surrounding communities. |
| Timetable for assistance design, processing and implementation | |
|---|---|
| Concept Clearance | 31 Mar 2015 |
| Credit Committee Meeting | - |
| Approval | 16 Sep 2015 |
| Last PDS Update | 28 Sep 2018 |
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.
The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.
The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.
In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
| Title | Document Type | Document Date |
|---|---|---|
| Sustainable Projects: Extended Annual Review Report | Extended Annual Review Reports | Dec 2020 |
| Senior Loan to BRAC Bank for Sustainable Projects: Initial Poverty and Social Analysis | Initial Poverty and Social Analysis | Nov 2015 |
| Sustainable Projects: Report and Recommendation of the President | Reports and Recommendations of the President | Aug 2015 |
Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
None currently available.
Evaluation Documents See also: Independent Evaluation
None currently available.
Related Publications
None currently available.
The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.
Requests for information may also be directed to the InfoUnit.
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