Kathmandu, 17 April 2025 – The Adaptation Fund Board has approved the Green, Resilient, and Adaptive CHT Economy (GRACE) – Local Climate Adaptive Living Facility (LoCALplus) project, a significant step forward in climate adaptation in Bangladesh. The project will use USD 10 million funding to help the most vulnerable hill communities in the Chattogram Hill Tracts (CHT), Bangladesh, become more resilient to climate change.

"The GRACE project marks a pivotal chapter for the Chattogram Hill Tracts—an ecologically rich yet acutely vulnerable region of Bangladesh. This transformative initiative opens the door to meaningful investment in climate resilience while upholding the dignity, rights, and well-being of the ethnic minorities inhabiting this area,”- MS Syeda Rizwana Hasan, Honourable Advisor, Ministry of Environment, Forest and Climate Change & Ministry of Water Resources.

The beautiful landscape of CHT in Bangladesh is a biodiversity hotspot, providing essential ecosystem services for economic development, environmental protection, and human wellbeing, and is home to diverse tribal communities. However, the region was identified as one of the most ‘climate stressed'  areas of the country, in Bangladesh’s recent National Adaptation Plan (NAP). CHT also remains among the most underserved areas of the country and lacks livelihood options. Water sources such as springs are drying up, flash floods and landslides are increasing, and livelihoods are becoming increasingly unstable, especially for women and youth.

“We deeply appreciate the approval of the Adaptation Fund’s USD 10 million investment, which is evidence of Bangladesh's national leadership in climate adaptation. The GRACE Project will enable local governments and empower CHT dwellers for a resilient future founded on inclusive governance and Nature-based Solutions aligned with SDGs in CHT, Bangladesh” - H.E. Mr. Supradip Chakma, Honourable Advisor, Ministry of Chittagong Hill Tracts Affairs, Bangladesh.

The GRACE project will provide extensive nature-based solutions and community-driven climate adaptation strategies throughout  Rangamati, Khagrachari, and Bandarban districts. The project  will help to establish climate-resilient infrastructure, improve retention ponds, restore springs and groundwater recharge systems in the water-scarce upazilas (sub-district units).

The initiative will promote sustainable land utilisation by applying climate-resilient agriculture methods suited to the region’s unique topography. Additionally, GRACE will improve the capacity of local governments, women, and youth to actively participate in climate-resilient development, disaster risk mitigation, and adaptation planning.

To ensure that climate finance is distributed effectively and fairly at the local level, the interventions will be implemented through the ‘Local Climate Adaptive Living Facility’ (LoCAL) mechanism, providing performance-based climate resilience grants. The GRACE project will directly supported 25 upazilas during its first phase, later expanding to cover the remaining 10 upazilas of the CHT.

This project will make use of performance-based climate resilience subsidies managed through government frameworks inspired by the LoCAL concept. This approach will ensure a fair distribution of resources, promote transparency, and support continuous oversight from institutions.

The GRACE project is spearheaded by the Ministry of Environment, Forest and Climate Change (MoEFCC), Bangladesh, as the official Designated Authority (DA) for the Adaptation Fund. The International Centre for Integrated Mountain Development (ICIMOD) is the regional implementing entity. The MoEFCC, in coordination with ICIMOD, ensured that the GRACE Project is aligned with Bangladesh’s priorities and strategies for the Chattogram Hill Tracts (CHT). GRACE will facilitate the execution of Bangladesh’s National Adaptation Plan (NAP) via Nature-based Solutions and inclusive community-driven adaptation initiatives.

“ICIMOD's mission is to provide science-based, locally led solutions to mountain communities, which is exemplified by the GRACE initiative. In collaboration with the Government of Bangladesh, we are dedicated to developing climate resilience that empowers the community and safeguards ecosystems in CHT, Bangladesh.”

 -Dr.  Pema Gyamtsho, Director General, ICIMOD.

About International Centre for Integrated Mountain Development (ICIMOD)

The Hindu Kush Himalaya (HKH) region stretches 3,500km across Asia, spanning eight countries – Afghanistan, Bangladesh, Bhutan, China, India, Myanmar, Nepal, and Pakistan. Encompassing high-altitude mountain ranges, mid-hills, and plains, the zone is vital for the food, water, and energy security of up to two billion people and is a habitat for countless irreplaceable species. It is also acutely fragile, and vulnerable to the impacts of the triple planetary crisis of climate change, pollution, and biodiversity loss.

The International Centre for Integrated Mountain Development (ICIMOD), based in Kathmandu, Nepal, is an international organisation established in 1983, that is working to make this critical region greener, more inclusive and climate resilient. For more information, read our Strategy 2030 and explore our website.
About Green, Resilient, and Adaptive CHT Economy (GRACE) project

The GRACE project is being implemented by ICIMOD in partnership with Bangladesh’s Ministry of Environment, Forest and Climate Change (MoEFCC), Ministry of Chittagong Hill Tracts Affairs (MoCHTA), Local Government Division, Chittagong Hill Tracts Development Board (CHTDB), and three Hill District Councils in collaboration with the United Nations Capital Development Fund (UNCDF).