ADB Loan Package to Strengthen Bangladesh’s Cross-border Trade
31 March 2022
The Asian Development Bank (ADB) supports the improvement of efficiency, predictability, and security of Bangladesh’s cross-border trade, approving a $143 million loan package that will contribute to accelerating the country’s growth. Bangladesh: SASEC Integrated Trade Facilitation Sector Development Program includes a $90 million policy-based loan and a $53 million project loan that will upgrade trade infrastructure and improve three priority land ports to better Bangladesh’s trade with its neighbors in the subregion.
Mr. Tadateru Hayashi, Principal Economist, ADB, underscored that ADB’s assistance supports the Government of Bangladesh’s goal of accelerating economic growth through industrialization and trade. The program will help diversify Bangladesh’s export products and destinations. Improved connectivity will facilitate subregional trade and commerce among the South Asia Subregional Economic Cooperation (SASEC) countries.
The Program’s policy-based investment will support policy reforms to help Bangladesh comply with the World Trade Organization (WTO) Trade Facilitation Agreement (TFA), and implement the Customs Modernization Strategic Action Plan, 2019–2022. It focuses on three reform areas:
- Customs legal framework to comply with international standards. Achieving relevant policy actions will advance compliance with articles of the WTO TFA.
- Improvement of cargo clearance processes. This reform will promote an efficient, predictable, and transparent cargo clearance process by streamlining the cargo clearance process and introducing new technology.
- Enhancement of institutional capacity. This will assist Bangladesh’s National Board of Revenue in developing and conducting training programs, including on gender awareness to implement the WTO TFA, improve trade processes, and conceive future reforms.
Project investment in trade facilities will upgrade infrastructure by
- Building integrated land customs stations and land ports;
- Installing facilities and equipment for customs clearance and cargo transshipment operations; and
- Operationalizing the policy reforms undertaken by the program part at Akhaura, Sonamasjid, and Tamabil border crossing points. Central customs facilities will also be designed for Dhaka, and integrated trade facilities at Bibirbazar, Birol, Darshana, Sheora, Sonahat, and Teknaf border crossing points.
ADB will also provide a $1.5 million technical assistance grant to support the modernization of the country’s customs legal framework and coordination among the border agencies, prepare an operationalization plan of central customs facilities, strengthen NBR’s capacity to implement modernized customs operations at the border crossing points, and build the project implementation capacity of Bangladesh’s National Board of Revenue and the Bangladesh Land Port Authority.
Bangladesh has been carrying out trade facilitation strategies to enhance export diversification and competitiveness by improving the quality of exports, signing bilateral trade and investment cooperation agreements, and promoting trade through better coordination among border agencies and private stakeholders, notes ADB’s news release.