ADB approves $400m to support climate priorities

The Asian Development Bank (ADB) today approved a US$400 million policy-based loan to support Bangladesh in implementing its National Adaptation Plan, 2023-2050 and Nationally Determined Contributions 2021 Update to the Paris Agreement to achieve a climate-focused inclusive development.

Bangladesh is one of the world’s most vulnerable countries to the adverse impacts of climate change, recording an annual average loss of about $3 billion, said a press release on Friday.

This loan is the first subprogram of the indicative $700 million Climate-Resilient Inclusive Development Program, which will help Bangladesh strengthen its climate resilience, transition to a low-carbon economy, mitigate its greenhouse gas emissions, and mainstream gender equality and social inclusion in the government’s climate actions.

“Climate shocks have been severely disrupting Bangladesh’s growth and poverty alleviation. Financing needs for climate actions are astronomical. Bangladesh has strongly committed to tackling this challenge, and ADB, as the region’s climate bank, is ready to support Bangladesh in its efforts,” said ADB Principal Public Management Economist Aminur Rahman.

The program will create an enabling institutional and policy environment to mobilize climate finance, prioritize climate actions in the country’s overall development agenda, and help the government implement reforms in climate-critical sectors, including agriculture, disaster management, transport and infrastructure, urban development, and energy.

The program facilitated the creation of the National Committee for Environment and Climate Change headed by the Prime Minister for holistic implementation of the government’s climate priorities across ministries. The program will intensively support the government in operationalizing the Bangladesh Climate and Development Partnership launched recently at COP 28. The program supports the mainstreaming of climate priorities in government planning and resource allocation, and the mobilization of climate finance through green bonds and sustainable finance policy.

At the sectoral level, the program promotes climate-smart and climate-resilient agricultural practices, especially those that favor female farmers, adaptation of solar irrigation pumps, introduction of climate-resilient infrastructure design and planning, and regulatory framework for adaptation of electric vehicles and introduction of electric buses in the public transport fleet. ADB also helps promote climate-resilient city action plans and improved drainage system for municipalities to reduce urban flooding.

In October 2021, ADB announced it is raising its ambition to deliver climate financing to its developing member countries to $100 billion from 2019 to 2030. This will expand access to new, climate-focused technologies and mobilize private capital toward climate finance.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members-49 from the region.