In a major setback for the Bangladesh government, the World Bank has decided to cancel its loan of 1.2 billion US Dollars for construction of the 2.9 billion dollar Padma Multipurpose Bridge project with immediate effect.

According to a statement issued by the World Bank in Washinghton, the bank decided to cancel the loan in the light of inadequate response by the Government of Bangladesh to its proposed actions that it had recommended for dealing with the credible evidence that had emerged with regard to corruption in the project.

The bank has claimed that it had provided the evidence that emerged from two investigations to the Bangladesh Prime Minister Sheikh Hasina, Finance Minister A.M.A Muhith and the Chairman of the country’s Anti Corruption Commission in September 2011 and April 2012.