The Asian Development Bank (ADB) has mobilized 261 million U.S. dollars of private sector capital for a new expressway that will ease traffic congestion and provide better connectivity between the Bangladeshi capital Dhaka and other major cities, the Manila-based lender said Thursday.

The 13.5-km four-lane expressway is being funded through a 193-million-U.S. dollar loan from the Asian Infrastructure Investment Bank (AIIB), Bank of China, DBS Bank and Infrastructure Development Company, a non-banking financial institution based in Bangladesh, said the ADB which serves as a transaction advisor for the government of Bangladesh's Rampura Amulia Demra Expressway public-private partnership (PPP) project.

The remaining 68 million U.S. dollars is provided by sponsors as equity contributions, it said in a statement.

ADB assisted in project structuring, negotiation, tender execution, and provided support for commercial award and financial closure.

"We worked with the public authorities in Bangladesh to prepare, market, and attract private sector partners to design, build, finance, operate and maintain this expressway," head of ADB Office of Markets Development and PPP Cleo Kawawaki said.

"It will provide commuters with quicker access to their destinations by improving connectivity between Dhaka and eastern and southeastern districts of Bangladesh, including the cities of Chattogram, Narayangonj and the northeastern city of Sylhet."

Kawawaki said the Rampura Amulia Demra PPP project was delivered under an availability payment mechanism with partial revenue linked to U.S. dollar and taka exchange rate movements, whereas the first road transaction, the 370-million-U.S. dollar Dhaka Bypass Road PPP, was structured as a minimum revenue guarantee.

"ADB has therefore helped establish the pathway for both types of payment mechanisms in Bangladesh for future private sector investments in the infrastructure sector," she said.