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ADB Approves $230 Million Loan for Bangladesh Natural Gas Infrastructure


The Asian Development Bank has approved a $230 million loan package to expand the natural gas infrastructure and delivery system in Bangladesh. The project is expected to give a special boost to the economy of the western part of the country.

The project will construct four gas transmission pipelines to carry an estimated 360-million cubic feet of domestically produced natural gas a day to western Bangladesh, a less-developed region of nearly 15-million people. Another 320-kilometers of gas pipelines will be constructed to form a new distribution network within the region.

Western Bangladesh has a rich agricultural base, but a poor industrial one. Piya Abeygunawardena, the ADB's principle economist for the project, says the large amounts of natural gas that will be delivered can be put to good use.

"[The] Western part of the country is relatively poor, and all the development indicators, economic growth and income levels, those things are relatively poorer than the other parts of the country," he said.

Natural gas is widely used in Bangladesh, for power generation, home cooking, even to power vehicles. Cleaner transportation using compressed natural gas, or CNG, has cut pollution in the capital, Dhaka, and Mr. Abeygunawardena says the impact has been dramatic.

"Most of the vehicles nowadays in Dhaka are converted to CNG, and, as a result, a tremendous level of air pollution has been reduced, and the air has become cleaner, and the impact are really on health and environmental improvements, [and] are even visible to the naked eye," he added.

The ADB says Bangladesh has adequate gas reserves to meet its requirements, but the gas infrastructure is in poor condition. It says this has held back commercial, industrial and rural development.