South Korea will provide $3 billion in loans to Bangladesh for implementing mega projects.
The fund will come in next five years from 2023-2027, said a press release issued from Economic Relations Division (ERD) on Monday.
In this regard, ERD Secretary Sharifa Khan and Deputy Minister for International Affairs, Ministry of Economy and Finance of Korea Mr Seong-wook Kim have signed two agreements, the Letter of Understanding (LoU) and Cooperation Arrangement (C/A) on behalf of their respective countries.
At the same time Md Shahriar Kader Siddiky, Additional Secretary (Asia, JEC and F&F), Economic Relations Division and Mr Tae-soo Kim, Executive Director, Korea Exim Bank also signed the Cooperation Arrangement on behalf of respective sides.
The Korean government has been providing soft loan through the Economic Development Cooperation Fund (EDCF) for the development of socio-economic, infrastructure and JCT sectors in Bangladesh since 1993.
Already sixteen projects worth of $ 619.78 million have been completed with assistance from the EDCF and another seven projects worth of $ 616.28 are ongoing. Till now total commitment amount from the EDCF is $ 1.31 billion.
This is the second largest amount committed by the Korean Government for its development partner countries.
Under the signed Letter of Understanding (LoU) and Cooperation Arrangement (C/A), Korea will provide $ 3.00 billion as soft loan through EDPF for the period 2023-2027 to implement new mega projects in Bangladesh.
Interest rate of loan agreement of each project to be signed under this LoU and C/A through EDPF programme will be 1 percent with 30 year repayment period including seven year grace period, Management Fee would be 0.4 percent and contractors will be appointed through international bidding.