USD 200 Million financial assistance from ADB to Sri Lanka for road development work

A Loan Agreement for the third Tranche of the Second I-road Program under Asian Development Bank (ADB), amounting to USD 200 million was signed by S R Attygalle, Secretary, Ministry of Finance, and Chen Chen, Country Director, ADB Resident Mission in Sri Lanka today on behalf of the Government of Sri Lanka and ADB respectively, Treasury said.

“Economic growth is hindered by poor transport infrastructure, particularly some poorly maintained provincial and local roads,” said ADB Country Director for Sri Lanka Chen Chen.

“Access to markets and business opportunities, especially along agricultural value chains, can be significantly improved with better transport infrastructure and can serve as the key to poverty reduction and shared prosperity in rural areas.”

Secretary to the Treasury and Ministry of Finance S. R. Attygalle signed the loan agreement for the Government of Sri Lanka and Mr. Chen signed on behalf of ADB. A project agreement was also signed between ADB and the implementing agency, Road Development Authority, represented by Chairman C. P. Athuluwage.

Despite the present challenges of the coronavirus disease (COVID-19) pandemic, the project is being implemented while adhering to health guidelines and the well-being of its workers.

It is expected to support the post-pandemic economic recovery in rural areas through job opportunities and by obtaining services from rural populations, such as the hiring of vehicles, buildings, equipment, etc.

“Providing all-weather road access will help link rural communities to socioeconomic centers in Sri Lanka, thereby enabling rural communities to reap and enjoy the fruit of inclusive economic growth,” said Mr. Attygalle. “This is very much in keeping with the government’s development policy and will contribute to the government’s development plan.”

This loan is the third of five tranches under the Second Integrated Road Investment Program, which was approved by ADB’s Board of Directors in 2017. The program will deliver a total financing of $900 million to rehabilitate and improve about 3,400 kilometers (km) of rural access roads and 340 km of national roads in the Eastern, Northern, Uva, and Western provinces.