The USD 107 million loan is the second tranche of a USD 800 million multi-tranche financing facility to upgrade roads, the ADB said in a statement.
ADB's Country Director in Sri Lanka Sri Widowati signed the loan agreement on behalf of ADB while Secretary to the Treasury, Ministry of Finance Dr. R.H.S. Samaratunga signed for the Government of Sri Lanka.
The ADB has agreed to provide US$ 800 million loan assistance in 6 tranches to implement the program in Southern Province, Sabaragamuwa Province, Central Province, North Central Province, North Western Province and Kalutara District of Western Province. The government will invest USD 106 million.
Under Investment Program 1,000 rural community hubs will be selected based on the population, development potentials and the distance to trunk roads. Selected national roads, provincial and local authority roads including feeder roads will be rehabilitated to ensure the connectivity to the selected rural hubs.
The USD 107 million second tranche of the Integrated Road Investment Program ("iRoad"), in Sri Lanka is largely earmarked for the first slice of projects in the Sabaragamuwa Province, Kalutara District of the Western Province, Central Province, North Central Province, and North Western Province, helping provide 9.3 million people with swifter and safer travel.
The program will improve road connectivity to the rural hubs. With most of the rural access roads currently in poor condition, improvements will result in time savings and a decrease in large vehicle operating costs, ADB said.
According to the ADB, all-weather rural access roads will result in significant social benefits and poverty reduction, such as increased agriculture productivity since farmers will be able to get goods to market faster, better access to health services and education, and easier access to jobs.
The first tranche amounting USD 100 million was signed on 5th November 2014 to finance the first slice of the project in Southern Province in order to improve and/or maintain about 560 km of rural access roads to all weather standards and 130 km of national roads in Southern Province, enhance capacity of road agencies, including MOHPS, RDA and road agencies in Southern Province, and project preparation of remaining tranches, the Ministry of Finance said.
The Ministry of Highways and Investment Promotion which is the Executing Agency for the Project will be responsible for program-specific monitoring and reporting. The Road Development Authority will be the implementing agency. The overall project is scheduled to be completed by March 2024.
