| Project Detail |
The proposed project supports the Government of Bangladesh in enhancing the electricity distribution network in the rapidly expanding city of Dhaka to ensure reliable electricity supply to residential, commercial, and industrial sectors. The project will construct substations, lay underground cables, and overhead lines to provide reliable, safe, and improved quality of electricity supply to 200,000 new and 1.1 million existing customers in Dhaka. In addition, the project will improve the energy efficiency and also support the improvement of the operational capacity of Dhaka Electric Supply Company (DESCO).
Project Name Dhaka Power System Expansion and Strengthening Project
Project Number 55040-001
Country / Economy Bangladesh
Project Status Approved
Project Type / Modality of Assistance Loan
Technical Assistance
The proposed project supports the Government of Bangladesh in enhancing the electricity distribution network in the rapidly expanding city of Dhaka to ensure reliable electricity supply to residential, commercial, and industrial sectors. The project will construct substations, lay underground cables, and overhead lines to provide reliable, safe, and improved quality of electricity supply to 200,000 new and 1.1 million existing customers in Dhaka. In addition, the project will improve the energy efficiency and also support the improvement of the operational capacity of Dhaka Electric Supply Company (DESCO). The projects attached TA will enhance the governments and DESCOs public-private partnership (PPP) capacity, support the necessary reforms and develop a roadmap and action plan for strengthening DESCOs capacity for accessing commercial borrowing, and support inclusiveness in DESCOs operations by strengthening and monitoring gender equality and social inclusion (GESI) requirements during project implementation.
Project Rationale and Linkage to Country/Regional Strategy Bangladesh is a low-lying country with a population of 174 million with a high vulnerability to risks arising from climate change and disasters triggered by climate events. Driven by manufacturing and services, Bangladeshs gross domestic product (GDP) has grown well above the average for developing countries achieving 7.9% in fiscal year (FY) 2019 but the growth decreased to 3.4% in FY2020 due to the global coronavirus disease (COVID-19) pandemic. It has since recovered with 7.1% GDP growth in FY2022 up from 6.9% in FY2021. Affected by higher global commodity prices, supply chain disruptions, and slowed external demand, growth has declined to 6.0% in FY2023 and is projected to be 6.5% in FY2024. The high levels of poverty have fallen consistently over the past decades, declining from 48.9% in FY2000 to 18.7% in FY2022. Bangladeshs Eighth Five-Year Plan (FY2021FY2025) targets attaining an annual 8.5% GDP growth, further reducing poverty, and raising living standards of Bangladesh with the long-term aim of becoming an upper-middle-income country by 2031 and a high-income country by 2041. To maintain the high economic development trajectory, Bangladesh is diversifying its industrial base from garments to investing in growing industries such as information technology, leather, jute, and pharmaceutical. Therefore, improving the quality and reliability of power supply coupled with enhancing electricity transmission and distribution network is a prerequisite for sustaining economic growth, poverty reduction, GESI, economic diversification, and achieving the target of becoming a high-income country by 2041. Also, given the exposure of the country to the adverse impacts of climate change, investing in a safe and resilient power supply system is beneficial for the more vulnerable sections of society.
Impact
A sustainable development pathway resilient to disaster and climate change developed. |
