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France to give €50m for energy efficiency in Bangladesh

The fund will also be used to promote women entrepreneurship

  • Staff Correspondent
  • 17 August, 2021 12:00 AM
  • Print news
France to give €50m for energy efficiency in Bangladesh

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French lending agency Agence Française de Développement (AFD) will provide €50 million (around Tk 5 billion) to help energy efficiency, renewable energy and women entrepreneurship projects in Bangladesh.

Bangladesh Infrastructure Finance Fund Limited (BIFFL) and public sector financial institutions (FIs) will receive the fund from AFD and distribute it among the targeted projects.

In this regard, a Credit Facility Agreement (CFA) of €50 million was signed between the Bangladesh government and the French development agency at a function at Economic Relations Division (ERD) on Thursday.

ERD secretary Fatima Yasmin and AFD country director for Bangladesh Benoit Chassatte signed the loan agreement on behalf of their respective sides, said a ERD release on Monday.

It is a loan to the government of Bangladesh with a maturity period of 15 years, including a three-year grace period. Interest rate on the loan amount will be Euribor 6 months+35 bp, ERD officials informed.

The project will contribute to the process of economic transition of Bangladesh towards a greener economy.

In particular, it aims to increase the volume of investments in energy efficiency and renewable energy production in Bangladesh.

Dissemination of such investments in those areas will be within the private sectors like SMEs in industrial sector and cooperatives in rural areas and so on.  The project will help promote female entrepreneurship as well in the country, the ERD said.

The credit line will be on-lent by the Bangladesh government to the public non-banking financial institution, BIFFL to finance investments in the fields of energy efficiency, the production of renewable energies, mainly in rural areas and for the development of women entrepreneurship.

AFD is the bilateral development agency implementing Official Development Assistance (ODA) on behalf of the French government.  It has had its operation in Bangladesh since 2012. It supports development projects for urban development and infrastructures (water and sanitation, public transports, urban services), power & green energy (energy efficiency, renewable power), corporate and social responsibility (enhancement of safety standards and environmental and social performance).

The agency provides concessional sovereign loans and mobilise grants under the regional blending facility of the European Union.