Govt okays Ghorasal power project, finally

The government has at last approved the costly Ghorasal 365-megawatt (MW) power plant, which will be built on Chinese buyers' credit.
Presided over by the Prime Minister Sheikh Hasina, the Executive Committee of the National Economic Council (ECNEC) Tuesday in Dhaka endorsed the Ghorasal power station project at a cost of Tk 25.11 billion (US$306.32 million) and three other projects with a combined outlay of of Tk 2.82 billion.
The Planning Commission had earlier refused to approve the Ghorasal power project as the Bangladesh Power Development Board (BPDB) decided to borrow hard-term credit from the single source without looking for cheaper loans.
The government will borrow Tk 16.53 billion (nearly $202.5 million) from the Chinese ICBC Bank on hard terms and conditions to set up the gas-fueled plant at Ghorasal in Narshingdi.
The rest of the money will come from the government exchequer and the BPDB's own funds for installing the plant by December 2016.
According to the terms and conditions, the ICBC bank will provide the loan at a rate of LIBOR plus 3.5 per cent.
The bank will charge 1.50 per cent as arrangement fee, 1.0 per cent as commitment fee and 7.0 per cent of the total credit amount export credit insurance fee (one time), officials said.
The loan will have to be repaid by the BPDB in 10 years with a five-year grace period, they said.
A Power Division official said the state-owned BPDB has already completed tendering process and selected a Chinese company CNTIC & CMC China Consortium to construct the plant.
The board signed the contract with the Chinese company for setting up the plant on May 29 last year after the Cabinet committee of the government purchase gave its nod for the bid price on January 9 last year, the official said.
Another power division official said since power generation tops the government's priority agenda, the board has secured the buyers' credit at what he claimed at lower rate from China.
"It's really time-consuming to obtain concessional loan. So, we opted for the buyers' credit," he said.
The ECNEC also approved Tk 541.1 million "Setting up of the Autistic Academy", Tk1.28 billion cost "Establishment of National Institute of Advanced Practice Nurses in Bangladesh" and Tk 995 million cost "Setting up of National Science and Technology Institute" projects at its meeting.
ECNEC members including finance minister AMA Muhith, industries minister Amir Hossain Amu, agriculture Minister Begum Matia Chowdhury and officials concerned attended the ECNEC meeting.