$2 billion LoC

India yet to relax terms

 Indian was yet to agree with Bangladesh’s proposla to relax the conditionalities tagged with the disbursement of second Line of Credit (LoC) worth $2 billion.
At an inter-ministerial meeting at Economic Relations Division (ERD) at Sher-e-Bangla Nagar of the capital yesterday, Bangladesh sought a provision under which it can implement the projects using 40 per cent domestic components while the rest, 60 per cent, of the projects will be implemented using products or components from India.
Presently, India wants Bangladesh to use 75 per cent of Indian products while implementing projects supported by Delhi.
According to the agreement reached earlier, goods and services, including consultancy services of the value of at least 75 per cent of the contract prices, shall be supplied by the seller/s from India, and the remaining 25 per cent goods and services may be procured by the seller/s for the purpose of the ‘Eligible Contract’ from outside India.

Bangladesh has proposed to India, saying at least 10 of the mutually agreed projects by Bangladesh and India under $2 billion LoC should be civil construction related projects.
“If the Indian content is not re adjusted, all the projects may suffer at the time of implementation. Even, Bangladesh may have to withdraw the projects this time too,” the proposal said.
In response to the new proposal, India wrote—“In case of civil construction related projects, the Indian content may be further reduced from 60 per cent to 50 per cent and further reduction can be considered on a case to case basis.”     
The new proposal also said, taxes, duties and value added taxes (VAT) on eligible goods and services, and all corporate, personal, VAT, import, custom duties, special levies and social security contributions for temporary employees deputed by the seller/s in relation to the execution of work under this loan will be imposed and paid as per the laws, rules and regulations of Bangladesh.

$2 billion LoC

India yet to relax terms

Indian was yet to agree with Bangladeshs proposla to relax the conditionalities tagged with the disbursement of second Line of Credit (LoC) worth $2 billion. At an inter-ministerial meeting at Economic Relations Division (ERD) at Sher-e-Bangla Nagar of the capital yesterday, Bangladesh sought a provision under which it can implement the projects using 40 per cent domestic components while the rest, 60 per cent, of the projects will be implemented using products or components from India. Presently, India wants Bangladesh to use 75 per cent of Indian products while implementing projects supported by Delhi. According to the agreement reached earlier, goods and services, including consultancy services of the value of at least 75 per cent of the contract prices, shall be supplied by the seller/s from India, and the remaining 25 per cent goods and services may be procured by the seller/s for the purpose of the Eligible Contract from outside India. Bangladesh has proposed to India, saying at least 10 of the mutually agreed projects by Bangladesh and India under $2 billion LoC should be civil construction related projects. If the Indian content is not re adjusted, all the projects may suffer at the time of implementation. Even, Bangladesh may have to withdraw the projects this time too, the proposal said. In response to the new proposal, India wroteIn case of civil construction related projects, the Indian content may be further reduced from 60 per cent to 50 per cent and further reduction can be considered on a case to case basis. The new proposal also said, taxes, duties and value added taxes (VAT) on eligible goods and services, and all corporate, personal, VAT, import, custom duties, special levies and social security contributions for temporary employees deputed by the seller/s in relation to the execution of work under this loan will be imposed and paid as per the laws, rules and regulations of Bangladesh.