Staff reporter :
Bangladesh has signed a loan agreement worth approximately $630 million with Japan to fund the ‘Construction of Dual Gauge Double Line between Joydebpur-Ishurdi Section Project (I)’—a major infrastructure initiative aimed at enhancing the country’s rail connectivity and trade capacity.
The agreement was signed on Friday at the NEC-2 conference room of the Economic Relations Division (ERD) at Sher-e-Bangla Nagar, Dhaka. Md Shahriar Kader Siddiky, Secretary of the ERD, signed on behalf of the Government of Bangladesh, while Ichiguchi Tomohide, Chief Representative of the Japan International Cooperation Agency (JICA) Bangladesh Office, represented the Government of Japan.
This funding is part of the second batch under Japan’s 46th Official Development Assistance (ODA) loan package. It follows the “Exchange of Notes” signed earlier in Tokyo on 30 May 2025 during the official visit of Chief Adviser Muhammad Yunus to Japan.
The project involves the construction of a 162-kilometre dual gauge double track between Joydebpur and Ishurdi, significantly boosting rail capacity on a critical corridor. In addition to the mainline, the plan includes 25 km of loop and siding lines, reconstruction of 11 km of existing tracks, and the development of three new stations. Various other supporting infrastructures will also be built to ensure efficient rail operations.
The loan will be disbursed in phases. Japan has already committed $32 million for the engineering services component. Under this new agreement, the loan terms include a 2 percent interest rate for construction work, 0.65percent for consultancy services, and a 0.20percent one-time front-end fee. The repayment period is set at 30 years, with a 10-year grace period.
Japan continues to be Bangladesh’s largest bilateral development partner, having committed over $33.6 billion in loans and grants since the country’s independence. Japanese support spans key sectors including transportation, energy, agriculture, healthcare, education, water supply, and rural development.
