China keen to provide loan for another metro rail project

China Exim Bank is interested in providing loans for construction of a metro rail route stretching from Gabtoli to Narayanganj via Sadarghat.

China would provide Tk 450 billion in the project, known as metro rail-2, worth Tk 600 billion.  

The Economic Relations Division (ERD) held a meeting with the visiting delegation of the Chinese Exim Bank on Wednesday afternoon. ERD’s additional secretary Mirana Mahrukh led the ERD team at the meeting held at ERD auditorium.

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A total of nine projects were discussed at the meeting. Apart from metro rail, the Chinese bank is also interested in providing loans for Bhanga to Payra port railway project, estimated cost at Tk 410.80 billion.

Bangladesh also showed interest about Chinese loans in construction of a new bridge over the river Kocha in Pirojpur and repair of the Muktarpur bridge in Munshiganj. The other railway projects listed for Chinese loans include constructions of dual gauge rail track from Joydebpur in Gazipur to Jamalpur, broad gauge railway track from Dhalarchar in Pabna to Panchuria in Faridpur, a railway workshop in Rajbari and conversion of the metre gauge line to dual gauge from Bhairab Bazar to Mymensingh. These projects were discussed in yesterday’s meeting.

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Meanwhile, discussion was held about the availability of Chinese currency equivalent to USD 5 to 7 billion. Bangladesh informed the Chinese side about the interest rate and repayment period with grace period of such trade facility with other countries or organisations.

An ERD source said a fund like export development fund can be created after taking loans in Chinese currency. Bangladeshi exporters will be paid in Yuan against imports from China.

An official of ERD said the announcement about the Chinese loans in these road and rail projects might be made at the prime minister Sheikh Hasina’s China visit slated for 8-11 July.

China has not provided Bangladesh any loan in the last one year. In the latest, Chinese loan was available in an infrastructure development project of Rajshahi WASA in May 2023. Usually when China proposes loans for any project, the Chinese authorities fix the contractor for the specific project. That contractor implements the work. There is no scope to select contractors through a tender process.