Bangladesh is set to seek a final commitment from South Korea on a $1.1 billion loan next week to co-finance the MRT-5 Southern-line metro-rail project, as the government prepares to commence construction of the route. Finance Minister Amir Khosru Mahmud Chowdhury will travel to the Republic of Korea on October 31 for a weeklong official visit, during which he is expected to meet with his Korean counterpart and other senior officials to discuss expanding bilateral economic and trade cooperation.
The $4.9 billion MRT-5 Southern-line project, approved by the Executive Committee of the National Economic Council in September 2026, aims to alleviate traffic congestion in Dhaka by enhancing public transportation connectivity. Dhaka Mass Transit Company Limited (DMTCL) plans to develop the 17.20-kilometer metro line stretching from Gabtoli to Dasherkandi, featuring both underground and elevated sections. Of the total route, 13.10 kilometers will be underground and 4.10 kilometers elevated, with the project including 15 stations—11 underground and four elevated.
The Asian Development Bank has already committed approximately $3 billion in financial support for the project, while the South Korean government has expressed interest in cooperating as a co-financier. However, despite multiple requests from Bangladesh over the past months, Seoul has not yet provided a definitive response regarding the $1.1 billion loan.
Officials from Bangladesh’s Economic Relations Division (ERD) indicated that the finance minister’s upcoming visit could clarify South Korea’s position, potentially unlocking the necessary funding to proceed with the project’s financing arrangements. A senior ERD official described the proposed Korean loan as critical to meeting the substantial investment needs of the MRT-5 Southern Line, which is a key part of Bangladesh’s broader strategy to expand its mass rapid-transit infrastructure.
A DMTCL representative underscored the urgency of converting development partners’ financing commitments into concrete agreements aligned with the project’s implementation timeline. Should the Korean loan be secured, it would complement the Asian Development Bank’s assistance and strengthen the overall financing structure.
During his visit, Finance Minister Chowdhury is also expected to seek additional budgetary support and explore extended loan arrangements for other development initiatives. His itinerary includes meetings with major South Korean conglomerates such as Samsung and LG, as well as visits to manufacturing plants.
South Korea’s proposed loan is anticipated to come through the Economic Development Cooperation Fund (EDCF), known for its highly concessional terms. The EDCF offers near-zero interest rates, ranging from 0.05 to 0.1 percent, with repayment periods extending up to 40 years, making it an attractive financing option for Bangladesh’s infrastructure projects.