Bangladesh Bank (BB) has selected 24 banks and financial institutions as participating financial institutions (PFIs) for providing 7,033 million Japanese Yen (equivalent to Tk 5,445 million) in loans under a foreign direct investment (FDI) promotion project.
A signing ceremony with 19 banks and five FIs was held at Jahangir Alam conference room of the central bank headquarters in the city on Wednesday, in presence of BB governor Fazle Kabir.
JICA chief representative Takatoshi Nishikata, BB deputy governor Abu Hena Mohammad Razi and Association of Bankers Bangladesh (ABB) chairman Syed Mahbubur Rahman addressed the function.
Chief executives of the PFI banks and FIs, and general manager and deputy general manager of BB's Foreign Exchange Investment Department (FEID) were present.
The FEID is implementing the FDI promotion project, funded by the Japan International Cooperation Agency (JICA), to facilitate Japanese FDIs in special economic zone, industrial park/estate etc.
Under the JICA-funded project signed on December 13 in 2015, a soft loan provision of 7,033 million Japanese Yen was kept for Japanese investors, Japan-Bangladesh joint ventures or Bangladesh firms having significant business relation with Japan. The concessional loan bears 7.0 per cent interest.
Addressing the signing ceremony, governor Fazle Kabir said that with selecting the PFIs, opportunities created not only for the business owners and workers, but also a financing facility was created for the banking industry.
He said the FDI promotion project is to ensure smooth flow of financing for the Japanese investors and others concerned, he said.
The governor highlighted contribution of Japanese government to the development of the country's different sectors and said that the Official Development Assistance of Japan has impressive contribution to infrastructure and manufacturing sectors, particularly in retrofitting the textile factories.
The governor also called upon the PFIs to provide support in rightly disbursing loans in time and hoped that the Japanese investors will also take the full advantage of the country's investment opportunities.
The JICA chief representative laid importance on proper and adequate financing in any business and requested the PFIs to follow the operational guidelines and terms of conditions for ensuring proper financing of the concessional loan to the enterprises.
The deputy governor also called upon the PFIs to be careful in financing under the project and said the JICA loan would help promote and diversify private sector industries for economic development of the country.
As per the project, highest Tk 300 million will be provided to the borrowers in electronic, light engineering, leather, food processing and ICT sectors with seven per cent interest rate for various terms - one to 10 years.
Any enterprise seeking concessional loan more than Tk 300 million would need approval by the steering committee.
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