Uganda secures €650.75 Million IsDB financing for Standard Gauge Railway project
The SGR project is expected to significantly improve Uganda's transport infrastructure, reduce cargo transportation costs, enhance regional trade competitiveness and strengthen connectivity with neighbouring countries.
Uganda has secured €650.75 million (approximately Shs2.7 trillion) in financing from the Islamic Development Bank (IsDB) for the construction of key components of the country’s Standard Gauge Railway (SGR), marking the largest amount ever approved by the bank’s Executive Board for a single project in Uganda.
The financing was approved during the 51st Islamic Development Bank Group Board of Governors’ Annual Meetings held in Baku, Azerbaijan, from June 16 to 19, 2026, under the theme, “Regional Integration for Sustainable Prosperity.”
The Permanent Secretary and Secretary to the Treasury, Dr. Ramathan Ggoobi, who represented Uganda as the country’s Temporary Governor to the IsDB, welcomed the approval and reaffirmed the government’s commitment to achieving financial closure for the transformative infrastructure project by November 2026.
“The Government of Uganda remains committed to ensuring financial closure for the Standard Gauge Railway project within the set timelines,” Dr. Ggoobi said during engagements on the sidelines of the annual meetings.
The approved financing will support the construction of several critical components of the eastern route of the SGR, including the 553-metre Jinja Nile Bridge, the 2.12-kilometre Mbuya-Kampala tunnel, six railway stations located in Tororo, Iganga, Jinja, Lugazi, Kampala East and Kampala City, as well as three railway workshops in Kampala East, Jinja and Tororo.
The SGR project is expected to significantly improve Uganda’s transport infrastructure, reduce cargo transportation costs, enhance regional trade competitiveness and strengthen connectivity with neighbouring countries.
The latest approval further deepens the long-standing partnership between Uganda and the IsDB. As of May 2026, Uganda had eight active public sector operations financed by the bank through loans and grants worth a combined US$896.55 million.
A significant share of the portfolio is concentrated in transport infrastructure, with projects under the Integrated Transport Infrastructure Services Programme accounting for approximately US$721 million.
Among the major projects financed by the IsDB are the upgrading of the Muyembe–Nakapiripirit Road, the Rwenkunye–Apac–Lira–Acholibur Road, and irrigation schemes in Unyama, Namalu and Sipi. The bank has also supported technical and vocational education and training initiatives aimed at enhancing skills development.
Other ongoing IsDB-funded projects include the upgrading of Katine–Ochero Road and associated urban roads in Kaberamaido and Kalaki towns, construction of Masindi Port Bridge, upgrading of Kyenjojo–Kihura–Bwizi–Rwamwanja–Kahunge and Mpara–Bwizi roads, as well as the Kumi–Ngora–Serere–Kagwara Road project.
In the health sector, the bank is financing the establishment of regional oncology centres in Arua and Mbale to expand access to specialised cancer treatment services.
During the Governors’ Roundtable, Dr. Ggoobi commended the IsDB for launching the IsDB Concessional Fund (ICF) in 2026, an initiative aimed at increasing concessional financing to approximately 15 per cent of the bank’s annual approvals.
He said the fund comes at a critical time when many developing countries are facing shrinking and increasingly unreliable foreign aid flows.
“The fund is particularly important as traditional development assistance continues to decline both in volume and predictability, thereby widening financing gaps for developing economies,” Dr. Ggoobi noted.
He also called on multilateral development finance institutions to reform and adapt to evolving global economic realities.
“Given the ongoing changes in the global financial architecture, multilateral development finance institutions such as the IsDB must become more inclusive, adaptive and responsive to the development needs of member countries,” he said.
The approval of the SGR financing represents a major milestone in Uganda’s efforts to modernise its transport network and accelerate regional economic integration through improved railway infrastructure.
