Bangladesh is expecting $1 billion loan from the New Development Bank (NDB) for implementing five development projects.
The loan will be used to implement projects in various sectors, including clean energy and energy efficiency, transport infrastructure, water and sanitation, environmental protection, social infrastructure and digital infrastructure, insiders said.
“We have discussed with the Shanghai-based lender to finance five more development projects. They have assured us of providing the loan,” a deputy secretary of the Economic Relations Division (ERD) told The Bangladesh Post preferring anonymity.
“Already, the NDB will provide loan of $325 million for water supply project of Dhaka Wasa. Hopefully, the loan proposal will be approved in the NDB’s board meeting by this month,” the official also said.
In May, a seven member delegation headed by He Tian, project team leader of Public Sector Department of the NDB met ERD officials to discuss about the loan.
According to ERD officials, Bangladesh is expecting loan of $115 million for a 120MW solar power plant at Raipura, $112 million for a power distribution project in the Northern Electricity Supply Company (NESCO) area, and $203 million loan for improving the distribution system in the west zone.
“We have also sought loan from NDB for three projects of the Bridges Division, for constructing Payra, Bishkhali, and Karkhana bridges,” he also said.
In recent executive committee of the national economic council (ECNEC) meeting, Prime Minister Sheikh Hasina instructed to secure loans from NDB. Following the instruction, ERD Secretary Sharifa Khan initiated efforts to execute new projects using funds from the NDB. The ERD has formed unit to oversee loans from the NDB.
After the World Bank, the Asian Development Bank (ADB) and the Asian Infrastructure Investment Bank (AIIB), the NDB is going to be another multilateral lender to Bangladesh, according to the ERD.
The New Development Bank, formerly known as BRICS Development Bank, finances projects and innovates tailored solutions to help build a more inclusive, resilient, and sustainable growth.
The BRICS stands for Brazil, Russia, India, China and South Africa. These countries are the founding members of the NDB.
Bangladesh joined the development bank as a member in September 2021, obtaining around 1 per cent share. The United Arab Emirates and Egypt are also new members of the NDB that started operation in 2015.
Bangladesh paid its first installment of $15 million in March this year out of its $942 million worth of shares in the bank, ERD officials said.
Meanwhile, Dhaka will have to pay a total of $188 million in seven incremental installments annually as payable subscription while the remaining $754 million will be considered "callable fee" which it will not have to pay at this moment, said the officials.
Since its inception, the NDB has provided about $32 billion in loan assistance to its member countries for 80 different projects related to physical and social infrastructure and urban development.