Japan is likely to sign a deal on concessional loans amounting to US$1.18 billion for Bangladesh's five development projects, including the country's largest 1,200 megawatt (MW) coal-fired power plant in Cox's Bazar early next month, officials said Wednesday. The ministry of finance (MoF) officials said they are expecting that the Japanese government will sign the aid packages under its 35th Official Development Assistance (ODA) for Bangladesh.
"We have almost completed the process of signing the loan agreement with the Japan International Cooperation Agency (JICA). If we get green signal from the lender, we will finalise the loan confirmation deal," said a senior MoF official.
"We are hopeful that the $1.18 billion ODA package loan will be signed early next month."
The MoF official said they recently requested the JICA to sign the loan deal as soon as possible.
JICA Chief Representative in Bangladesh Mikio Hataeda when contacted by the FE said: "We are taking preparations to sign the 35th ODA package deal with Bangladesh government within the shortest possible time. I hope it will be completed by early next month."
He also said: "Since our Foreign Minister Fumio Kishida pledged the $1.18 billion ODA package for Bangladesh during his visit in Dhaka last month, the assistance will be confirmed soon." An MoF official said JICA will provide loan worth $405.52 million for setting up the proposed 1,200 MW Matarbari coal-fired power station in Cox's Bazar, and $300 million for inclusive city governance project.
Besides, JICA will also provide $250 million loan for energy efficiency project, $149 million for haor flood management and livelihood improvement project, and $97 million for small and marginal farmers' agricultural productivity improvement and diversification financing project.
Earlier, the Economic Relations Division (ERD) completed negotiations with JICA for getting the 35th ODA package, said the MoF officials.
Last month, the Japanese foreign minister visited Bangladesh, and formally announced the $1.18 billion soft loan deal for the five development projects in Bangladesh.
The interest rate of this ODA package loan is 0.01 per cent per annum, payable in 40 years, including 10 years grace period.
Japan, the largest bilateral development partner of Bangladesh, provided $2.1 billion soft loan for four projects in March 10, 2013 under its 34th ODA package.
