Bhutan Climate and Disaster Resilience Development Policy Financing with a Catastrophe Deferred Drawdown Option

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The operation will provide the Royal Government of Bhutan (RGoB) access to immediate liquidity in the aftermath of natural disasters including disease outbreaks through an IDA US$40 million Climate and Disaster Resilience Development Policy Financing (DPF) with a Catastrophe Deferred Drawdown Option (Cat DDO). The partnership between the RGoB and the World Bank over the last decade has sustained and deepened reforms toward a safe and resilient Bhutan, including the DPF with a Cat DDO (P173008; the First Cat DDO), which was fully disbursed (US14.8 million dollars) for the RGoB’s initial COVID-19 emergency response efforts. The Project Development Objective (PDO) is to strengthen the technical and institutional capacity of the RGoB to manage the risk of climate change and natural disasters. This would be achieved by supporting reforms under two pillars: (i) integrating climate and disaster resilience into critical infrastructure and buildings; and (ii) strengthening systems for natural disasters early warning and financial resilience of property. The operation builds on the partnership between the RGoB and the World Bank over the last decade, which has sustained and deepened policy and institutional reforms toward a resilient Bhutan.