Japan will provide some US$582 million worth of loans for Bangladesh's energy-and food-safety improvements, officials said, at a time when the country's foreign-currency reserves need replenishment.
The assistance comes under Japan's 45th overseas development assistance (ODA) package for which Bangladesh government and the lender signed two separate loan deals Tuesday in Dhaka.
Md. Shahriar Kader Siddiky, Secretary, Economic Relations Division (ERD) of the Ministry of Finance, Bangladesh, and SAIDA Shinichi, Ambassador of Japan in Bangladesh, and ICHIGUCHI Tomohide, Chief Representative, JICA Bangladesh Office, inked the loan agreements and exchange of notes.
Japanese lender JICA would provide $388 million (JPY 57,120 million) in loan for 'Matarbari Ultra Super Critical Coal-Fired Power Project (VIII)' while $194 million (JPY 28,699 million) for 'Food Safety Testing Capacity Development Project'.
To increase food-safety testing capacity of Bangladesh Food Safety Authority one reference laboratory, office and training centre in Dhaka and two divisional laboratories in Chittagong and Khulna will be set up under the 'Food Safety Testing Capacity Development Project'.
Total cost of the project is Tk 24.09 billion where Bangladesh government will provide Tk3.91 billion and JICA 20.19 billion. Implementation period of the project is January 2025 to December 2034.
The rate of interest of this loan will be in preferential term of 1.85 per cent for construction, 0.55 per cent for consultancy services and a front-end fee at a time of 0.20 per cent.
The repayment period will be 30 years which includes a 10-year grace period.
Meanwhile, Coal Power Generation Company Bangladesh Limited (CPGCBL) has been implementing a Tk 566.94-million project where the GOB is providing Tk 72.21 billion, JICA Tk 479.45 billion and the CPGCBL Tk 15.28 billion from its own fund.
To meet growing electricity demand and to improve the stable power supply of the country the Matarbari power project is being implemented in the coastal Matarbari area of Maheshkhali Upazila under Cox's Bazar district.
The project will be completed in December 2026. Up to February 2025, physical progress of the project is 92 per cent and financial progress is 86 per cent, ERD officials said.
JICA is providing assistance for this project in different phases. It has already provided JPY 655,310 million in 7 tranches.
Under this 8th tranche of the 45th Japanese ODA loan package, JICA confirmed JPY 57,120 million equivalent to US$ 388 million on Tuesday.
The rate of interest of this loan will be 1.95 per cent for construction, 0.55 per cent for consultancy services and a front-end fee of 0.20 per cent. The repayment period will be 30 years which includes 10 years' grace period.
Japan happens to be the largest bilateral development partner of Bangladesh, so far having committed US$32.62 billion worth of loans and grants for infrastructure development in different sectors like communications, power and energy, agriculture, education, health and family welfare, water supply and sanitation, rural development, environmental development, and human resource development.
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