The Asian Development Bank (ADB) has signed a $30 million sustainability-linked loan agreement with Envoy Textiles Limited (Envoy), marking ADB’s first loan of this kind in Bangladesh.
The agreement builds on ADB’s previous textile manufacturing initiative with Envoy, launched in 2022.
Envoy Textiles Limited is a Bangladesh-based denim fabric manufacturer, recognized as the first denim facility to achieve LEED Platinum certification for its sustainable operations.
The funding will be used to build a new automated and energy-efficient spinning unit at Envoy’s Jamirdia plant in Valuka, Mymensingh. The unit will add an annual production capacity of 4,550 tons of yarn, mainly for denim output. Additionally, the project includes the installation of a 3.5-megawatt rooftop solar system and partial refinancing of existing short-term local working capital loans.
In a statement on Thursday, ADB stated that sustainability-linked loans are performance-based financing connected to sustainability goals. For Envoy, the main objectives include increasing rooftop solar capacity and cutting greenhouse gas emissions.
“The ready-made garment industry is a key driver of Bangladesh’s economy, accounting for over 80% of the country’s total export earnings, and Envoy is the leading denim fabric manufacturer,” ADB Country Director for Bangladesh Hoe Yun Jeong said.
“ADB is pleased to support Envoy with its first sustainability-linked loan in Bangladesh. This partnership advances environmental sustainability and industrial modernization, setting a new standard for the garment sector,” he added.
Envoy manufactures 54 million yards of denim fabric each year, accounting for roughly 10% of Bangladesh’s total output. Its Jamirdia plant was the first in the country to implement rope dyeing technology and to feature a backward-integrated spinning facility with a daily yarn production capacity of 70 tons.
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