DHAKA on Wednesday signed an agreement with New Delhi for a $4.5 billion fresh loan following the provision of procuring 65 to 75 per cent goods and services from India for implementing 17 development projects in Bangladesh. However, the local implementing agencies would have to take prior approvals from the Indian authorities to complete the procurement which they fears would delay execution of projects even further.
The amount may appear colossal in terms of multi-billion dollars, but the fact is — Bangladesh which earlier struck deals with India for One billion dollar credit in 2010 and Two billion dollar in 2016 could release only half a billion dollar in the last seven years.
We are somewhat mystified by the fact that these bottlenecks have been allowed to go unaddressed. It is high time that the concerned ministries unravel the reasons behind such procrastination that has resulted in crucial development projects taking a backseat.
Even though the Finance Minister has clearly voiced his dissatisfaction over the incredibly slow disbursement of loan with the first and second Indian Line of Credit, but then why did it appear so necessary for inking the new deal?
Our government high-ups could have first finished obtaining the pending $2.5 billion dollar worth of pending loans and then start thinking about signing the new deal. The fresh loan would enable the implementation of projects in infrastructure such as power, railway, roads, shipping and development of ports. Despite the interest rate of the loan being one per cent annually coupled with a repayment period of 20 years with five years as grace period, but Bangladesh will have to depend solely on the Indian suppliers for the goods and service because of the ‘limited tendering method’ tagged by India instead of the open tendering system. Additionally, the loan also bears 0.5 per cent commitment fee.
Our biggest next-door neighbour and also supposedly the closest ally has deliberately trapped us by forcing Bangladesh to surrender its financial interests in the most submissive manner.
Understandably, the fresh credit deal with India is similar to that of the suppliers’ credit — a worst form of loan. Moreover, the loan recipients have no choice but to procure goods from the loan providing country under such deal.
The government is under no compulsion to seek such loans which would purely benefit the loan providing nation which is resulting in delay and unwarranted predicaments for the receiver.
