ADB, Bangladesh Sign $143 Million Trade Facilitation Project
16 June 2022
The Asian Development Bank (ADB) and the Government of Bangladesh signed on 16 June 2022 an agreement to improve cross-border trade in Bangladesh. Mr. Edimon Ginting, ADB country director for Bangladesh, and Ms. Fatima Yasmin, secretary, Economic Relations Division, Bangladesh, signed the $143-million loan agreement to improve the volume, efficiency, predictability, and security of cross-border trade in the country.
The loan will help increase the volume of imported and exported cargo at the Akhaura, Sonamasjid, and Tamabil border crossing points by 50% by 2027 and reduce customs clearance and cargo transshipment time by 50%, said Mr. Ginting. E-payment will be implemented and capacity at the border crossing points will be increased to handle 520,000 tons of international transit cargo per year. Designs for a central customs laboratory, warehouse, and customs regional training academy will also be provided.
The ADB assistance package includes a $90-million policy-based loan that will support reforms to bring Bangladesh’s customs legal frameworks in compliance with international standards, improve cargo clearance processes, and strengthen the capacity of the National Board of Revenue and the Ministry of Commerce. A $53-million project loan will construct integrated land customs stations and land ports, and install facilities for customs clearance and transshipment operations.
In addition, a $1.5-million technical assistance grant from ADB’s Technical Assistance Special Fund will support the modernization of the customs legal framework and coordination among border agencies, prepare an operationalization plan for central customs facilities, and strengthen the capacity of government agencies to implement modernized customs operations.
Bangladesh has been implementing trade facilitation reforms to accelerate export diversification and improve competitiveness by improving quality of exports, signing bilateral agreements, and promoting trade through better coordination among border agencies and private stakeholders. The South Asia Subregional Economic Cooperation (SASEC) Integrated Trade Facilitation Sector Development Program will reform trade policies and improve the cross-border trade facilities at Akhaura, Sonamasjid, and Tamabil cross-border points. The program will facilitate trade and increase connectivity among SASEC countries through Bangladesh as a subregional hub. It will also help Bangladesh diversify its export destinations in the subregion.