The Islamic Development Bank (IsDB) has approved financing worth EUR 650.75 million for the construction of Uganda’s Standard Gauge Railway, marking the largest amount ever approved by the Board for a single project in the country.
The approval was made on the sidelines of the 51st Islamic Development Bank Group Board of Governors’ Annual Meetings, held in Baku, Republic of Azerbaijan from 16th to 19th June 2026 under the theme, “Regional Integration for Sustainable Prosperity.”
The financing will be used to construct the Jinja Nile Bridge (553 metres), the Mbuya-Kampala tunnel (2.12 kilometres), six stations in Tororo, Iganga, Jinja, Lugazi, Kampala East, and Kampala City, as well as three workshops in Kampala East, Jinja, and Tororo.
Permanent Secretary and Secretary to the Treasury Ramathan Ggoobi, who led the Ugandan delegation as Temporary Governor, affirmed the government’s commitment to achieving financial closure for the project by November 2026.
The project represents a significant milestone for Uganda’s infrastructure development, as the Standard Gauge Railway is expected to reduce transport costs, improve efficiency in moving goods and passengers, and enhance regional connectivity.
As at the end of May 2026, the IsDB and Uganda had eight signed public operations, including loans and grants, worth USD 896.55 million. These are dominated by the Integrated Transport Infrastructure Services Program, with projects worth USD 721 million.
Other projects financed by the IsDB include: Technical and Vocational Education and Training, Upgrading of Muyembe-Nakapiripirit Road, Upgrading of Rwenkunye–Apac–Lira–Acholibur Road, Irrigation Schemes Development in Unyama, Namalu, and Sippi, Upgrading of Katine-Ochero Road, including town access roads in Kaberamaido and Kalaki, Construction of Masindi Port Bridge, Upgrading of Kyenjojo (Kihura–Bwizi–Rwamwanja–Kahunge and Mpara–Bwizi) roads, Upgrading of Kumi-Ngora-Serere-Kagwara Road and Establishment of Regional Oncology Centers in Arua and Mbale
At the Governors’ Round Table, Ggoobi thanked the IsDB for the Concessional Fund (ICF) launched in 2026, which aims to drive the bank’s total concessional financing to approximately 15 percent of annual approvals, bridging the gap between rising global debt and sustainable development.
He said the fund is crucial in light of declining traditional foreign aid flows, both in volume and reliability, which are widening the financing gap.
Given the changes in the global financial architecture, Ggoobi said there is a need for multilateral development finance institutions such as the IsDB to reform and become more inclusive, adaptive, and responsive to the needs of their member countries.
The Standard Gauge Railway is one of Uganda’s most ambitious infrastructure projects, designed to modernise the country’s transport network and facilitate trade with regional neighbours, particularly Kenya. The railway is expected to complement the existing meter-gauge line and eventually link to the regional network.
