PMs upcoming visit to India
$4b deal eyed
Bangladesh has primarily selected 26 projects
JAGARAN CHAKMA
Bangladesh and India may sign a pact to expand Indian investment in the country when Prime Minister Sheikh Hasina visits the neighbouring country in February. According to sources in the finance ministry, Bangladesh has primarily selected 26 projects worth over $4 billion for talks. The sources said the projects are related to the ports, airports, railways, and roads that have a link with Indian land ports. This would help boost trade between the neighbours.
This will be Hasinas first official visit since the Narendra Modi-led government assumed power in May 2014. In March, India signed a landmark agreement with Bangladesh, extending $2 billion to the country in its biggest ever overseas credit line, five years after it inked a credit agreement worth $1 billion with its neighbour.
The agreement was inked according to Indian Prime Minister Narendra Modis announcement during his visit to Bangladesh in June 2015. Bangladeshi officials in the know said this credit would be used in a wide range of areas, including the social sector. The previous credit line was mostly concentrated on communication infrastructure.
The projects that have been primarily selected are: The Buriganga river (new Dhaleswari-Pungli-Bangshi-Turag-Buriganga river system) restoration project ($196.18 million), the Ashuganj-Zakiganj route ($38 million), the Payra port dry bulk-coal terminal ($300 million), the Payra port multipurpose terminal ($350 million), the Bay container terminal in Chittagong (no estimate yet), the Chittagong dry dock (no estimate yet), the Chittagong port expansion plan (no estimate yet), the design-and-build broad-gauge railway line from Bhanga to Barisal and the feasibility study from Barisal to Payra sea port ($514.14 million), the construction of a new dual-gauge railway line from Bogra to Shaheed M Mosur Ali station in Sirajganj ($501.23 million), the 33km Feni-Belonia railway link ($100 million), the procurement of 30 broad-gauge locomotives ($150 million), the construction of flyovers and underpasses in Dhaka and Chittagong metropolitan areas (no estimate yet), the 135km four-lane Benapole-Jessore-Narail-Bhatiapara-Bhanga highway ($100 million), the 35km four-lane Ramgarh-Baruerhat Road ($50 million), the 98km four-lane Comilla (Maynamoti)-Baria-Sarail-Akhaura road ($75 million), transmission network development on the new alignment of the NE-Bangladesh-NER ($300 million), a pipeline from Siliguri to Parbatipur (and further to Rangpur) for NRL (Numaligarh Refinery Limited) and a tank terminal ($50 million), installation of one lakh LED streetlights in Dhaka, Chittagong, and Rajshahi by Energy Efficiency Service Ltd ($25 million), the Mollahat 100MW solar power plant ($150 million), supply of machinery for solid waste management in Dhaka South City Corporation (no estimate yet), upgrade of LCs to ICPs on both sides (no estimate yet), optical-fibre cable network development in 100 union parishads ($130 million), the development of rail- and road-based ICD in Ishurdi ($35 million), the 1000-acre Mirsarai Export Processing Zone ($50 million), the upgrade of Saidpur airport no estimate yet), and the upgrade of Khulna airport ($100 million).
Regarding the upcoming deal, the officials believe the Indian government wants to compete with China, which inked a huge deal during its president Xi Jin Pings visit in October.
However, they pointed out that though the Chinese credit is huge, there is no guarantee that it will come immediately. Besides, the interest rate is comparatively higher.
India had provided $1 billion line of credit at 1 per cent interest rate. The Chinese rate is at least 2 per cent plus LIBOR, 0.25 per cent management fee, and 0.25 per cent commitment charge.
