A Canadian Non-Banking Financial Institution (NBFI) has shown interest to finance the country’s public sector large projects in the form of loans, officials concerned said.
The Finance Division under the Ministry of Finance (MoF) has prepared an opinion paper on the proposal of Global Clear Financial Services Ltd (GCFSL) following the request from the Bank and Financial Institutions Division (BFID).
The GCFSL may finance the public sector’s large projects according to the government’s existing specific process.
Besides, the institution will be able to take part in the bidding process of sovereign bond if issued by the government, the officials said.
Earlier, the Prime Minister’s Office (PMO) asked the BFID to give its opinion on the proposal made by the GCFSL, a finance ministry source said.
A meeting was held between the officials of the High Commission of Bangladesh and GCFSL in the UK where the management of the GCFSL showed interest to finance the government’s large projects in the form of loans.
The BFID has sought an opinion on the GCFSL’s proposal. “We have sent the opinion paper to the BFID,” Deputy Secretary of the MoF Mohd. Rashedul Amin said.
He, however, said the authority of the financial institution can provide loan for any public projects as per the country’s existing rules.
The government takes concessional and non-concessional loans from different foreign sources for implementation of its various development projects through Economic Relations Division (ERD), sources concerned said.
Usually, the World Bank (WB) and the Asian Development Bank (ADB) provide loans as budgetary aid and donation, which is under the jurisdiction of the Ministry of Finance, according to the MoF sources.
Any autonomous organisation and state agencies can secure loans from any financial institution to implement their own projects. The agencies invite tenders for selecting organisations and setting conditions for obtaining loans in the implementation of their projects. In some cases, the government guarantee the loans if the institution concerned wants such guarantee, they mentioned.
There is no need for any approval from the government in financing the public projects by the GCFSL according to the existing rules. They can offer loans to any large public sector projects, a high official of the MoF said.
