Loan deal with JBIC Sept 26

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FE Report
Japan will provide $291 million loan to Bangladesh for development of its power, railway and water sectors, official sources confirmed.
An agreement to this effect will be signed in Dhaka on September 26 next, official sources said.
A senior official of the Economic Relations Division (ERD) told the FE that the date for signing the credit deal had been confirmed following discussion with the bilateral donor early this month.
The loan agreement could not be signed earlier due to political turmoil in the country, the official noted.
He added that negotiations for the Japanese assistance were completed in December last year.
According to ERD sources, the Japan Bank for International Cooperation (JBIC) will provide $144 million credit for setting up a 360-megawatt (MW) capacity power plant at Haripur, $104 million for modernising railway communications system between Dhaka and Chittagong and $43 million for water resources development.
A source in the Power Division said the government has already started the process for setting up the 360MW Haripur power plant. "After signing the loan deal, the division will start physical work on the installation of the power plant," he said.
He also said the government expects the proposed plant to begin power generation in 2010.
All the power plants in the country now produce about 3400MW to 3800MW of electricity daily against the demand for more than 5000MW, leaving a shortfall of over 1500MW each day.
Meanwhile, the power division official said the government is trying to convince the donors to provide funds for the development of country's ailing power sector that failed to attract donors for the last two decades.
"At last, the big multilateral donors -- the World Bank and the Asian Development Bank -- have come forward along with Japan to finance installation of three separate power plants," he added.
The ERD official said that the $104 million JBIC's loan for railway would be utilised for modernising the railway tracks and signals on the Dhaka-Chittagong route in order to improve transportation of goods from the country's largest port city Chittagong to the capital Dhaka.
"If the railway system between the capital and the port city is improved, transportation of passengers and goods will be easier and faster," the official said.
Besides, the rest $43 million credit will be invested for the improvement of water bodies to conserve water for irrigation purposes and development of fish resources in the rural areas of the country, he said.