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Import orders scale all-time high of $16.1b

BAEC opens $11.38b LC for Rooppur NPP

Siddique Islam | December 15, 2017 00:00:00

The country's overall import orders recorded an all-time high of US$ 16.10 billion in November while letter of credit (LC) of a large amount was opened for setting up Rooppur Nuclear Power Plant (NPP), officials said.

Bangladesh Atomic Energy Commission (BAEC) opened the LC worth $ 11.38 billion through the state-owned Sonali Bank Limited to import different items, including capital machinery, to build the plant, according to the Bangladesh Bank's (BB) latest data, released on Thursday.

The state-run nuclear energy research and regulatory body is in charge of implementing the project, first of its kind in the country, with financial, technical and technological support from Russia's Rosatom State Atomic Energy Corporation.

The estimated project cost of the NPP is $ 12.65 billion, 90 per cent of which will be provided by the Russian government on credit with LIBOR (London Interbank Offered Rate) plus 1.75 per cent interest. The remaining 10 percent will be provided by the Bangladesh government.

"The LC will be settled under buyers' credit. So it will not put any extra pressure on the local market as well as on the country's foreign exchange reserve," a senior official of BB told the FE.

He also said the import orders stood at $ 4.72 billion in November 2017 after deducting the figure of Rooppur NPP LC.

"It was almost stable," he also said.

The import orders were $ 4.43 billion in October 2017. The figure was $ 4.37 billion in November 2016.

On the other hand, the actual import in terms of settlement of LCs rose to $ 4.11 billion in November 2017 from $ 4.09 billion a month ago. It was $ 3.77 billion in November 2016, the BB data showed.

"The LC for Rooppur NPP will be settled by using overseas fund," Subhash Chandra Das, chief financial officer of Sonali Bank, told the FE.

He also said the bank is providing all sorts of banking services to import the required capital machinery and raw materials to set up the only NPP in Bangladesh.

BAEC will settle the LC using the Russian credit, which will have the tenure of 30 years with a 10-year grace period. Bangladesh will have to start repaying the loans from March 2027.

The commissioning of unit-1 of Rooppur NPP is scheduled for 2023, while its second unit is scheduled for 2024. The plant is expected to supply 2,400 megawatts of electricity to the national grid by 2024.

Prime Minister Sheikh Hasina inaugurated the main construction work of the project on November 30 with which the country has entered into the era of nuclear power generation.

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