World Bank approves US $500 Million loan for Sri Lanka
The World Bank’s Board of Executive Directors today approved $500 million in financing for Sri Lanka to provide safe, climate-resilient roads to connect agricultural supply chains through the Inclusive Connectivity and Development Project.
This project is expected to benefit around 16 million people living in rural communities in selected districts of Sri Lanka.
In Sri Lanka, roads carry around 95 percent of passengers and 98 percent of cargo. While nearly all national roads are paved, only 67 percent of provincial roads, and 13 percent of rural roads are in good condition. Sri Lanka also has the highest rate of road fatalities in South Asia with around 3,000 deaths per year. An uninterrupted road network is crucial to link rural communities to health and education services and other economic opportunities, and to connect small-holder farmers to domestic and international markets.
“Improving access to basic services and economic opportunities in rural areas, and reducing regional disparities in economic development, is critical for promoting inclusion and opportunities for all,” said Faris Hadad-Zervos, Country Director of the World Bank for Maldives, Nepal, and Sri Lanka. “The project will also create many short-term employment opportunities, which will help advance the post-pandemic recovery.”
This project is part of the development program to improve 100,000 km of rural roads, a key initiative under the Government’s national development strategy.
“The project will help develop green and climate-resilient transport and agricultural logistics, and mainstream climate resilience practices in infrastructure planning and investments for a more resilient future for Sri Lanka,” said Winnie Wang, World Bank Task Team Leader of the Project.
The project will build on the ongoing provincial and rural roads rehabilitation initiatives under the World Bank- financed Transport Connectivity and Asset Management Project and the Asian Development Bank-funded Integrated Road Investment Programs – iRoad I and II.
This project will be implemented by the Ministry of Highways and a National Steering Committee will be established to oversee the project.
The $500 million loan is provided by the International Bank for Reconstruction and Development (IBRD). The variable spread loan has a final maturity of 28 years including a grace period of 10 years.
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