Dhaka keen to attract more Indian, Chinese funds
March 13th, 2010 - 1:46 pm ICT by IANS
Dhaka, March 13 (IANS) Bangladesh has decided not to bargain with foreign lenders for lowering loan interest rates in a bid to attract funds from India, China, South Korea and others for funding development projects, officials said here.
Dhaka expects investments from India, which has also pledged $1 billion of credit when Prime Minister Sheikh Hasina was in New Delhi in January.
Hasina is to visit China on Wednesday hoping to strengthen ties with Beijing that is a major economic partner and supplier of defence hardware.
The economic relations division (ERD) and all ministries and divisions have been asked not to insist on reducing interest rates even if it is not below two percent charged by lenders, so that loan negotiations could be concluded quickly, New Age newspaper said Saturday.
The planning ministry sent the directive in a letter to the ministries last week.
The decision to agree on interest rate at around two percent for loans during bilateral negotiations on foreign-funded projects was taken at a meeting Jan 21 of the National Economic Council, the government’s highest policy making body, with Hasina in the chair.
ERD officials said the decision was aimed at receiving loans from newly emerging sources of bilateral lending such as India, China and South Korea - countries which have developed strong industrial base to supply various equipments to another country.
It, however, asked the ministries and divisions to try to ensure that the terms and conditions of the loan agreements were ultimately in favour of the government of Bangladesh.
“We are currently negotiating with China, India and South Korea bilaterally for funding several projects at low interest rate,” ERD secretary M Musharraf Hossain Bhuiyan said.
Dhaka has failed to realise $8.66 billion in foreign aid between 1972 and 2009 for various reasons including slow negotiations, according to the ERD.
The present government hopes to mobilise $ 2.25 billion foreign aid in the next fiscal to implement key development projects on conclusion of loan negotiations with development partners as soon as possible, sources in the ERD said.
The country received foreign aid amounting to $1.23 billion in the first eight months of the current fiscal.
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- India spells 'easy' terms for $1 bn loan to Bangladesh - Apr 01, 2010
- Dhaka approves $7 bn for development projects - May 20, 2012
- Three East Asian economies reach out to Bangladesh - Jul 09, 2010
- Big Japanese aid for Bangladesh bridge - Nov 30, 2010
- Bangladesh signs deal with China for 3G technology - Jun 09, 2011
- World Bank backs Dhaka's power, transit deals with Delhi - Aug 15, 2010
- IMF to give $1 bn loan to Bangladesh - Apr 13, 2012
- Indian credit terms 'good', says Bangladesh - Aug 08, 2010
- Bangladesh gets $1 bn loan from India - Aug 07, 2010
- Bangladesh gets $1.2bn World Bank loan for bridge - Apr 28, 2011
- South Korea's short-term foreign debts hit four-year low - Feb 21, 2012
- $826 million ADB loan to India for power transmission - Mar 30, 2012
Tags: bhuiyan, bilateral negotiations, bilaterally, development projects, economic partner, economic relations, erd, foreign aid, government of bangladesh, hossain, india china, jan 21, loan agreements, loan interest rates, minister sheikh hasina, musharraf, national economic council, New Delhi, present government, south korea