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The Financial Express

WB tells govt to divert funds from less-important projects

FHM HUMAYAN KABIR | Published: April 09, 2020 09:21:02 | Updated: April 09, 2020 13:01:42


Reuters file photo Reuters file photo

The World Bank (WB) has advised Bangladesh to divert unutilised funds from the ongoing less-important development projects to help strengthen its fight against coronavirus, officials said on Wednesday.

The Washington-based lender has recently requested the Economic Relations Division (ERD) to estimate the amount that can be diverted from the ongoing projects funded by it, they said.

"We have started work on assessing the possibility of fund diversion. The diverted amount will be used for the projects to respond to the Covid-19 emergency," ERD Additional Secretary Shahbuddin Patwary told the FE.

The total amount of aid committed by the WB against 45 ongoing projects in Bangladesh now stands at about $13 billion.

The ERD Additional Secretary said: "Some of the WB-funded projects are struggling with implementation delays and tenures of some have expired while some have failed to utilise the pipeline aid. Implementation of some projects can also be delayed".

"So, we can divert some funds after obtaining permission from the WB."

Mr Patwary said since Bangladesh will require huge funds to put an effective fight against the deadly virus in the coming days, the Washington-based lender has suggested the procedure.

Meanwhile, Finance Minister AHM Mustafa Kamal on March 25 in a video conference with the World Bank headquarters had sought extended support for Bangladesh to tackle the virus impact on the economy.

The WB has recently approved $100 million funds from its fast-track facility to help Bangladesh respond to needs of fixing ailing health facilities.

A WB senior official said that the bank had taken approach globally to divert the un-utilised funds from the less-important projects to meet some pressing needs of priority projects.

Mr Patwary said since the $4.3 billion funds under the IDA-18 package for Bangladesh had already dried up, the bank had suggested them focus on the ongoing less important projects and un-utilised funds, it already confirmed.

"When we will complete the assessment, we will inform the WB. The bank may then permit us to divert the amount to the upcoming priority projects," he added.

It will give some breathing space to investment-hungry Bangladesh for implementing the priority projects as time demands, Mr Patwary said.

Meanwhile, the WB has announced it will deploy $160 billion funds for combating the pandemic, helping the economies from the losses across the globe in the next 15 months.

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