BD eyes $1.7b Chinese loan for power projects

PM likely to visit Beijing on July 1-4

Mir Mostafizur Rahaman | Published: June 10, 2019 22:19:07

Bangladesh is set to sign at least two loan agreements involving US$ 1.7 billion for two power grid projects during the upcoming visit of Prime Minister (PM) Sheikh Hasina to China.
"So far, the China visit is scheduled on July 1-4," competent sources said.
During the visit, the PM will meet Chinese President Xi Jin Ping, and the loan deals will be signed in presence of both the leaders, high officials told the FE on Monday.
On Sunday, Sheikh Hasina told a press briefing that she will visit China in July, but did not disclose the date.
Beijing is eager to welcome Prime Minister Sheikh Hasina, Chinese Ambassador Zhang Zuo told the FE last week.
The number of projects with Chinese loan may increase, as the line ministries concerned are still brushing up details of the PM's visit. Funding of eight other projects, for which China has pledged support, is pending, the officials added.
The total amount involving these projects is around $5.0 billion, a senior official of the Economic Relations Division (ERD) told the FE on Monday.
"We are interested to sign deals for at least two projects during the visit. These are - Expansion and strengthening of power sector network under DPDC area, worth $1.1 billion, and Power grid network strengthening project under PGCB, worth $690.30 million," a senior official of the ERD said.
Chinese EXIM Bank earlier wanted to provide the loan as commercial credit at an interest rate of 4.5 per cent. But, now it has finally agreed to provide the fund as concessional loan and preferential buyer's credit, for which Bangladesh has to pay 3.0 per cent interest on an average.
Apart from these two projects the other pending projects are - Establishment of six full-fledged TV stations of Bangladesh Television; Balancing, modernisation, rehabilitation and expansion of the public sector jute mills under the BJMC; Establishment of digital connectivity; Dhaka-Ashulia elevated expressway; Chinese economic and industrial zone; Conversion of MG railway track into DG railway track in Akhaura of Sylhet section of Bangladesh Railway; Rajshahi WASA surface water treatment plant, and Construction of double line (DG) in Joydevpur-Ishwardi section.
Agreements for 28 projects were signed during the Chinese president's visit to Bangladesh in October 2016.
The PM's visit to China is seen as a crucial one against the backdrop of the Rohingya crisis. Sheikh Hasina said she will discuss the issue with the Chinese president.
mirmostafiz@yahoo.com