India lays down stringent conditions for $2b LoC

To avail the $2 billion fresh Indian line of credit, Bangladesh will have to use 75 per cent of the money for importing goods and services, including consultancy services under the project, from India, said Economic Relations Division (ERD) sources.
Narrating the conditions laid out by India, the ERD officials said that the High Commission of India (HCI) on July 15 wrote a letter mentioning the terms.
Indian Prime Minister Narendra Modi during his Dhaka visit in June signed a MoU between India and Bangladesh for extending a new LOC of $2 billion. The HCI requested the ERD to process the draft dollar line agreement between the government of Bangladesh and the Exim Bank of India.
“The High Commission of India further proposes that the dollar credit line agreement could be signed in Dhaka in August and request the ministry to convey a date for signing the dollar credit line agreement,” the letter said.
According to the agreement Bangladesh has to adopt a transparent procedure based on competitive bidding for awarding the eligible contract to Indian sellers.
Bangladesh may conduct bidding in line with the prevailing procurement laws, rules and regulations of the country to ensure that the award of the eligible contract to the seller is made in a fair and transparent manner. The rules and regulations relating to competitive bidding should be clearly defined and details of which should be provided to the Exim Bank in advance.
According to the agreement, Bangladesh has to award the eligible contract to the seller based on a competitive bidding process.
The bidding should be restricted to Indian companies registered in India or incorporated or established under any law in force in India. Bangladesh needs to widely publicise the bids for the eligible contract through websites or any other suitable media and also in India though the websites of the Exim Bank and industry associations in India.
Besides, copies of tender notices (including corrigenda) and bid documents have to be approved by the Exim Bank prior to the floatation of tender.
The borrower needs to submit to the Exim Bank procedures proposed to be followed for the selection of Indian contractors or suppliers along with the pre-qualification criteria and complete set of tender documents, clearly identifying milestones linked to progress of the project and payments relating to that.
Bangladesh needs to agree that until all amounts due under the Credit Agreement have been paid in full, it will facilitate inspections undertaken by the representatives of Exim Bank of the buyer’s facilities, activities, books and records. Their officers and employees are expected to provide full co-operation and assistance. It’s understood that the Exim Bank will exercise the right of inspection limited to that portion of the buyer’s project that may have utilised the bank's funds.
All sums payable by the borrower under the Credit Agreement need to be paid in full without set-off or counter-claim or any restriction or condition and free and clear of any deduction for or on account of any present or future taxes.

India lays down stringent conditions for $2b LoC

To avail the $2 billion fresh Indian line of credit, Bangladesh will have to use 75 per cent of the money for importing goods and services, including consultancy services under the project, from India, said Economic Relations Division (ERD) sources. Narrating the conditions laid out by India, the ERD officials said that the High Commission of India (HCI) on July 15 wrote a letter mentioning the terms. Indian Prime Minister Narendra Modi during his Dhaka visit in June signed a MoU between India and Bangladesh for extending a new LOC of $2 billion. The HCI requested the ERD to process the draft dollar line agreement between the government of Bangladesh and the Exim Bank of India. The High Commission of India further proposes that the dollar credit line agreement could be signed in Dhaka in August and request the ministry to convey a date for signing the dollar credit line agreement, the letter said. According to the agreement Bangladesh has to adopt a transparent procedure based on competitive bidding for awarding the eligible contract to Indian sellers. Bangladesh may conduct bidding in line with the prevailing procurement laws, rules and regulations of the country to ensure that the award of the eligible contract to the seller is made in a fair and transparent manner. The rules and regulations relating to competitive bidding should be clearly defined and details of which should be provided to the Exim Bank in advance. According to the agreement, Bangladesh has to award the eligible contract to the seller based on a competitive bidding process. The bidding should be restricted to Indian companies registered in India or incorporated or established under any law in force in India. Bangladesh needs to widely publicise the bids for the eligible contract through websites or any other suitable media and also in India though the websites of the Exim Bank and industry associations in India. Besides, copies of tender notices (including corrigenda) and bid documents have to be approved by the Exim Bank prior to the floatation of tender. The borrower needs to submit to the Exim Bank procedures proposed to be followed for the selection of Indian contractors or suppliers along with the pre-qualification criteria and complete set of tender documents, clearly identifying milestones linked to progress of the project and payments relating to that. Bangladesh needs to agree that until all amounts due under the Credit Agreement have been paid in full, it will facilitate inspections undertaken by the representatives of Exim Bank of the buyers facilities, activities, books and records. Their officers and employees are expected to provide full co-operation and assistance. Its understood that the Exim Bank will exercise the right of inspection limited to that portion of the buyers project that may have utilised the banks funds. All sums payable by the borrower under the Credit Agreement need to be paid in full without set-off or counter-claim or any restriction or condition and free and clear of any deduction for or on account of any present or future taxes.