The Asian Development Bank (ADB) and the government of Bangladesh have signed agreements for a $143 million policy-based loan to improve the volume, efficiency, predictability and security of cross-border trade in Bangladesh.
Fatima Yasmin, Secretary, Economic Relations Division, and Edimon Ginting, Country Director, ADB, virtually signed the agreement on behalf of Bangladesh and ADB, respectively on Wednesday.
"Aligning with Bangladesh's policies and strategies, ADB is helping enhance export diversification and competitiveness for accelerating growth with industrialization and trade and expanding sub regional trade and commerce," said Country Director Edimon Ginting.
"ADB assistance will help increase the volume of imported and exported cargoes at the Akhaura, Sonamasjid and Tamabil border crossing points (BCP) by 50 per cent by 2027, while reducing average customs clearance and cargo transshipment time by 50 per cent," he added.
Ginting also said e-payment at the three BCPs will be implemented, with their capacity increased to handle 520,000 tonnes per year of international transit cargoes, and central customs laboratory, customs warehouse and customs regional training academy will be designed, reports BSS.
The report said Bangladesh has been carrying out trade facilitation reforms 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.
The South Asia Subregional Economic Cooperation Integrated Trade Facilitation (SASEC) Sector Development Program (SDP) will reform trade policies and improve the cross-border trade facilities at Akhaura, Sonamasjid and Tamabil BCPs.
It will also increase connectivity among SASEC countries by facilitating trade among the SASEC countries through Bangladesh as a subregional hub.
The SDP will help Bangladesh diversify its export destinations to countries within the subregion and shift away from ready-made garments to a more diversified export basket.
The ADB assistance package includes a $90 million policy-based loan, which will support reforms in areas including bringing the country's customs legal frameworks in compliance with international standards, improving cargo clearance processes, and strengthening the capacity of the National Board of Revenue (NBR) and the Ministry of Commerce.
To complement the policy reforms, a $53 million project loan will construct integrated land customs stations and land ports of NBR and the Bangladesh Land Port Authority (BLPA) at Akhaura, Sonamasjid and Tamabil border crossing points (BCPs).
Facilities and equipment for customs clearance and cargo transshipment operations will also be installed.
ADB will provide a $1.5 million technical assistance grant from its Technical Assistance Special Fund to support the modernization of the 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 BCPs, and build the project implementation capacity of NBR and BLPA.
As of 2021, ADB's cumulative assistance to Bangladesh since 1973 amounted to about $48 billion through loans, grants, and cofinancing. ADB's active portfolio in the country stands at around $11 billion with 50 projects as of April 2022.