Dhaka, Bangladesh (BBN)– The Asian Development Bank (ADB) and the Government of Bangladesh on Sunday signed an agreement for $55 million in soft loan to help reduce poverty in the Chittagong Hill Tracts by improving infrastructure and employment opportunities.

M. Musharraf Hossain Bhuiyan, Secretary, Economic Relations Division (ERD) and Thevakumar Kandiah, Country Director of ADB’s Bangladesh Resident Mission, signed the agreement on behalf of Bangladesh and ADB respectively, at a ceremony at ERD, Sher-e-Bangla Nagar, Dhaka.

The assistance for the Second Chittagong Hill Tracts (CHT) Rural Development Project (CHTRDP-II) will fund rural access roads and markets, improve small-scale water resources and watershed management, build community infrastructure, and promote small agri-business opportunities to increase incomes for communities in the ethnically unique and geographically remote three hill districts of Bandarban, Khagrachari, and Rangamati.

Over 60 percent of CHT rural households are involved in agriculture and agricultural labor. Communities are remote, and road and market infrastructure is limited. CHT suffers from income and human poverty. Average annual household incomes are about 30 percent lower than the national average of BDT 84,000.

“Overall incidence of severe poverty is 36 percent in CHT. Lack of access to markets impedes the transformation of production in CHT. Only 16 percent of CHT villages have access to paved roads, and the average distance between a village and the nearest paved road is 4.5 kilometers,” the ADB said.

The project has been designed through extensive and rigorous consultation with all stakeholders. All relevant institutions including the Ministry of Chittagong Hill Tracts Affairs and the Ministry of Finance, the Chittagong Hill Tracts Regional Council, the three hill district councils, circle chiefs, the Local Government Engineering Department, upazila and union parishads (elected council) members, various headmen and karbaris (village elder), and several nongovernment organizations were consulted.

Ministry of Chittagong Hill Tracts Affairs will execute the project which is expected to be completed by 2018.

BBN/SSR/AD-02Oct11-4:47 pm (BST)