The Bangladeshi Government has signed two financing agreements worth $515m with the World Bank to finance the expansion of the country’s electricity transmission network, as well as improve insurance coverage.

The credits to the government are being provided by World Bank’s concessional lending entity International Development Association (IDA).

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The first financing agreement will see the bank provide a $450m credit for the Enhancement and Strengthening of Power Transmission Network in Eastern Region project, which aims to improve the reliability of electricity supply and reduce load shedding in the eastern region, covering Cumilla and Noakhali, in addition to part of greater Chittagong.

The project will see the construction of 13 new substations and the rehabilitation of an existing substation in the eastern region of the country.

“By supplying uninterrupted power to the Mirsharai Economic Zone, port, airport or other key economic facilities, the project will help unlock private sector and job growth.”

The new substations will also help integrate renewable energy and new generations into the grid.

As part of the project, a 230kV transmission line will be built by the government through greater Cumilla and four short-distance 132kV lines in Cumilla and Noakhali.

World Bank Bangladesh, Bhutan and Nepal director Qimiao Fan said: “In recent years, Bangladesh has significantly increased power generation. That significantly increased power generation requires improvement and expansion of the transmission and distribution system to get to consumers.

“By supplying uninterrupted power to the Mirsharai Economic Zone, port, airport or other key economic facilities, the project will help unlock private sector and job growth.”

The project will also see new electricity connections to nearly 275,000 households and 16,000 agricultural consumers.

Through the second financing agreement, World Bank will invest $65m into the Insurance Sector Development Project, which has been designed to strengthen the regulatory and supervisory capacity of the Insurance Development and Regulatory Authority (IDRA).

The funds will also be used by the government to modernise the systems and business practices of state-owned insurance corporations Shadharan Bima and Jiban Bima.