Methods to raise fund for BIFFCL approved

The Ministry of Finance (MoF) has approved the financing methods to raise capital for Bangladesh Infrastructure Finance Fund Company Ltd (BIFFCL), a company approved by the government about one year back, to finance large and mega infrastructure projects of the country. The ministry has also approved an 11-member advisory board and a seven- member board of directors for the Infrastructure Company, first of its kind in the country, to arrange fund for projects to be implemented under the public private partnership (PPP) initiative. Finance Minister approved the proposal on Tuesday, a high official in the ministry said. "The BIFFCL will start its operation soon as the approval to raise funds by the company has been given and its organizational set up approved," a top finance official told the FE. "The country needs substantial amount of fund to finance its mega projects, which will be sourced from BIFFCL," the official added. The BIFFCL will issue different kinds of bonds and debt instruments like Foreign Currency Bond and Dollar Bond to borrow funds from foreign countries and Non-Resident Bangladeshis, an official in the ministry said. Besides, Muhith approved the proposal to prepare guidelines by the company itself on the equity participation by the government and percentage of loans to be provided from BIFFCL to implement PPP-related projects, sources said. Muhith also asked to appoint a Fund Manager soon, who will formulate guidelines on borrowing local and foreign funds to finance large power and infrastructure projects. The BIFFCL was formed in May, 2010 with an initial capital of Tk 16 billion. The cabinet meeting in July of the same year approved the formation of the company, which was registered with Registrar of Joint Stock Companies and Firms in March, this year. A high official of the MoF said the government needs investment of about $9.5 billion in the next five years for generation, transmission and distribution of power. Besides the power-related projects, there are many other mega projects to be implemented under the PPP initiatives. The projects include -- Dhaka-Chittagong access control highway at an estimated cost of $3.02 billion, Sky-train encompassing the Dhaka metropolis at an estimated cost of $2.80 billion, Dhaka City Subway at an estimated cost of $3.10 billion and Dhaka-Narayanganj-Gazipur-Dhaka elevated expressway at an estimated cost of $1.90 billion. The Advisory Board will be headed by Finance Minister AMA Muhith. The members of the board are- energy advisor to the Prime Minister communications minister, industries minister, shipping minister, executive chairman, Board of Investment, governor, Bangladesh Bank and four local and foreign experts.