Dhaka scraps World Bank loan for graft-hit bridge

February 02, 2013 - 2:46:31 am

DHAKA: Bangladesh’s government has withdrawn its request for World Bank financing for a high-profile bridge project that has been dogged by allegations of corruption, the bank said yesterday.

The Washington-based lender cancelled a $1.2bn loan to Bangladesh in June due to claims of graft involving senior public officials related to the financing of the $3bn Padma bridge project.

The cancellation embarrassed Bangladesh’s Prime Minister Sheikh Hasina who made construction of the 6.2km bridge, which would be the country’s biggest, one of her key election pledges in 2008.

The government asked the World Bank to reconsider its move to cancel funding, but the lender maintained that a “complete and fair criminal investigation” was required to release the loan.

“The World Bank has taken note of the government’s decision of not seeking renewed World Bank financing for the Padma Bridge,” a statement from the bank said yesterday.

The government had informed the World Bank of the decision on Thursday, but said it would continue with an investigation into the alleged corruption, the statement said.

Finance Minister AMA Muhith told online newspaper bdnews24.com that the government would now move to build the bridge with its own resources if necessary.

“At the same time, we have requested the other donors to stay with us. I am confident they will continue to support us for this project,” he said.

Other donors include the Japan International Cooperation Agency, the Islamic Development Bank and the Asian Development Bank.