WB lukewarm about promised $330m power sector loan
FHM Humayan Kabir | Saturday, 21 June 2008
The government, which desperately needs fund for energy sector development, is yet start negotiation for a US$330 million credit with the World Bank that pledged the amount for an integrated power project back in 2006.
"More than two years ago, the World Bank assured to finance a 300 megawatt (MW) power plant at Siddhirganj and two other projects, but it is yet to sit for a negotiation with the government after repeated requests," a senior power division official told the FE requesting anonymity.
The Washington-based lender in early 2006 assured the government of providing US$275 million fund, which was later increased to $330 million, for an integrated energy sector development project, which includes installation of the 300MW peaking power plant at Siddhirganj.
When asked, a spokesman of the World Bank in Dhaka Friday said the date for negotiations on loan for the integrated energy sector project in Bangladesh has not yet been fixed.
The power division official said: "After more than a decade major donors came forward in 2006 to provide financial support for construction of a number of power plants."
When the World Bank is yet to make any follow-up move the Asian Development Bank (ADB) and Japan have already materialised their commitments made last year, he said.
The ADB and the Japan government are providing over $700 million worth of funds for installing three power plants with a combined capacity of 660MW and some related energy and power sector development works in the country.
According to government's medium-term plan, installation of the proposed World Bank-funded 300MW peaking power station at Siddhirgang was scheduled for start early last year and completion by 2010.
The country has been facing more than 1200MW of load-shedding everyday over the last couple of years due to poor generation of power.
The power outage has already affected the industrial production badly in the country.
An ERD official said negotiation for the World Bank fund was to be completed in October 2007 and loan agreement by November-December period the same year. It was later rescheduled for early April this year, but that missed again, he said.
The $330 million fund, if received, will be utilised to set up a 60-kilometre long and 30-inch diameter gas transmission line from Bakhrabad to Siddhirganj to supply gas to the proposed power station and 11-km long 230kv power transmission line from Siddhirganj to Maniknagar for supplying power to the Dhaka city from the power station.
"More than two years ago, the World Bank assured to finance a 300 megawatt (MW) power plant at Siddhirganj and two other projects, but it is yet to sit for a negotiation with the government after repeated requests," a senior power division official told the FE requesting anonymity.
The Washington-based lender in early 2006 assured the government of providing US$275 million fund, which was later increased to $330 million, for an integrated energy sector development project, which includes installation of the 300MW peaking power plant at Siddhirganj.
When asked, a spokesman of the World Bank in Dhaka Friday said the date for negotiations on loan for the integrated energy sector project in Bangladesh has not yet been fixed.
The power division official said: "After more than a decade major donors came forward in 2006 to provide financial support for construction of a number of power plants."
When the World Bank is yet to make any follow-up move the Asian Development Bank (ADB) and Japan have already materialised their commitments made last year, he said.
The ADB and the Japan government are providing over $700 million worth of funds for installing three power plants with a combined capacity of 660MW and some related energy and power sector development works in the country.
According to government's medium-term plan, installation of the proposed World Bank-funded 300MW peaking power station at Siddhirgang was scheduled for start early last year and completion by 2010.
The country has been facing more than 1200MW of load-shedding everyday over the last couple of years due to poor generation of power.
The power outage has already affected the industrial production badly in the country.
An ERD official said negotiation for the World Bank fund was to be completed in October 2007 and loan agreement by November-December period the same year. It was later rescheduled for early April this year, but that missed again, he said.
The $330 million fund, if received, will be utilised to set up a 60-kilometre long and 30-inch diameter gas transmission line from Bakhrabad to Siddhirganj to supply gas to the proposed power station and 11-km long 230kv power transmission line from Siddhirganj to Maniknagar for supplying power to the Dhaka city from the power station.