ADB Approves Huge Loan for Chattogram–Dohazari Rail Upgrade

Bangladesh has taken a significant stride towards modernising its transport infrastructure in the south-eastern region, with the Asian Development Bank (ADB) formally approving a loan of USD 688 million for the Chattogram–Dohazari railway development project. The funding aims to transform one of the country’s key rail corridors into a modern, efficient, and environmentally sustainable transport network.

The loan agreement was signed on 22 December at the Economic Relations Division (ERD) office in Dhaka. On behalf of the Government of Bangladesh, ERD Secretary Md. Shahriar Qadir Siddique signed the agreement, while Ho Yong Jong, ADB Country Director for Bangladesh, signed on behalf of the Bank. Officials hailed the project as a milestone in the modernisation of Bangladesh Railway’s infrastructure.

The project is part of the “South Asia Subregional Economic Cooperation (SASEC) Chattogram–Dohazari Rail Project.” It encompasses the rehabilitation and modernisation of the existing 35-kilometre railway line and the construction of a 2.5-kilometre bypass track. Once operational, the bypass will allow trains heading to Dhaka and Cox’s Bazar to avoid Chattogram station, thereby reducing congestion and significantly shortening journey times.

Currently, the Dhaka–Chattogram–Cox’s Bazar rail corridor handles approximately 32% of domestic passenger transport and 55% of freight movement. Enhancing its capacity is expected to yield direct economic benefits, including reduced transport costs, improved supply chain reliability, and accelerated industrial and commercial activities. Experts note that modern rail connectivity will also stimulate regional trade and tourism.

The project is particularly significant for the tourism sector in Cox’s Bazar. By modernising rail connectivity, it is anticipated to support emerging tourism, fisheries, and export-oriented industries, alleviate road congestion, reduce accident risks, and contribute to carbon emission reduction. ADB emphasises that the project will enhance service reliability, disaster resilience, promote green transport, and strengthen regional linkages via the Trans-Asian Railway network, positioning Bangladesh as a strategic transport hub in South Asia.

Key Project Components

Established in 1966, ADB has been supporting inclusive and sustainable development across Asia and the Pacific. This latest investment in Bangladesh is expected to significantly strengthen the railway sector, enhance transport efficiency, and promote environmentally sustainable initiatives.