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Tokyo has officially confirmed it will provide Dhaka with $312 million to increase economic resilience and ensure a stable energy supply.
The Economic Relations Division (ERD) signed two documents related to the soft loan with Japan on Tuesday, the Japanese Embassy in Dhaka said in a media statement.
With this, Bangladesh is set to receive the first loan from the Japanese government's announcement of $10 billion in emergency aid for Asian countries in the energy sector following the war in West Asia.
After that, Siddiky and Chief Representative of Japan International Cooperation Agency (JICA) Bangladesh Office Takahashi Junko inked the loan agreement.
When the global energy market saw a growing crisis after the Iran war spread to West Asia, Japanese Prime Minister Takaichi Sanae organised the “Asia Zero Emission Community (AZEC) Plus Online Summit” on Apr 15.
At the conference, she pledged $10 billion in assistance under the “Partnership On Wide Energy and Resources Resilience (POWERR Asia)” initiative.
Addressing the event virtually, Prime Minister Tarique Rahman sought a $2 billion fund from development partners to meet Bangladesh’s immediate energy needs and safeguard economic stability.
On the loan to Bangladesh, the Japanese embassy said: “This timely support, in conjunction with Asian Development Bank, aims to address the socio-economic impacts in the context of recent global challenges, including rising energy prices and uncertainty in energy supply amid the deteriorating situation in the West Asia.”
Through this loan, Japan will support Bangladesh in financial management, improving the investment climate, and ensuring stable energy supply, the statement reads.
These sectors are essential for maintaining economic stability, the pace of reform, and long-term resilience, it adds.