China's financing to Bangladesh surges

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China has emerged among the leading bilateral creation partners of Bangladesh since it disbursed US$460.41 million loans in the first 50 percent of the existing fiscal year, insiders explained on Friday.

The world's second-largest economy during the last three . 5 years has improved its portfolio in Bangladesh with a reliable development in investments for the development work, they said.

Deputy secretary of the Economic Relations Division (ERD) Syed Ashrafuzzaman told the FE the Chinese expense for Bangladesh's development work has been drastically rising since FY'2018.

In FY'2018, Bangladesh received US$978.6 million worth loans from China, in comparison to only $64 million in FY2017, ERD statistics showed.

In the FY'2019, Beijing disbursed $515.08 million worth loa$695.5 million loans and grants, down from in FY2020.

Bangladesh and China turned their romance right into a strategic partnership found in October 2016 with a deal signed between Primary Minister Sheikh Hasina and Chinese President Xi Jinping.

Within Chinese president Xi Jinping's Belt and Road Initiative (BRI), Beijing and Dhaka signed deals well worth some $21 billion for upgrading infrastructure, especially in the transport, power and IT sector.

China is funding ongoing mega assignments such as for example Padma railway hyperlink, Dasherkandi normal water treatment plant, the production of national ICT infra-network for Bangladesh federal government phase III (Info-Sarkar), the building of a tunnel beneath the river Karnaphuli, and installing single point mooring (SPM) with the double pipeline.

China usually provides both concessional and costlier loans, including buyers' credit rating, to finance development jobs.

Former ERD secretary Kazi Shofiqul Azam told the FE that because so many of the assignments have been implemented during the last few years with fiscal support from China, its aid disbursement has picked up.

"Bangladesh government has signed a Memorandum of Understanding (MoU) with China worth over $20 billion for implementing 27 development assignments a few years back. Some of the projects' execution from the list has already been started. Thus, the help inflow is maintaining an increased graph," he added.

Executive director of the South Asian Network in Financial Modeling (SANEM) Dr Selim Raihan said with the emergence of China as a respected lender, it is best for Bangladesh that the aid reliance on the west has been decreasing over the years.

Chinese personal support to Bangladesh's high-challenging infrastructure development work is going to be paving the way to enhance its development, he told the FE.

"You know that China possesses one belt one highway intuitive. Besides, Dhaka and Beijing will be the companions of the Bangladesh-China-India-Myanmar Economic Corridor. So, it really is expected that Bangladesh will become getting higher the help of Beijing in future as well," he said.

Dr Raihan, as well an economics professor of Dhaka University, noted that along with China's improved monetary support, the Bangladesh authorities has to ensure the governance found in project implementation.

But Dhaka desires an "intelligent" and "sensible" negotiations with Beijing without super-stringent terms while getting loans and utilize the committed aid effectively and transparently for the production of the united states, the SANEM ED said.

Dr Raihan in addition has suggested executing the China-funded projects with time in order to avoid time and expense overrun.

A director of the China-funded project beneath the Vitality Division requesting anonymity told the FE that China will not take a lot of time to get permission for distinct procurement and project function.

"In most situations, we need to obtain approval from the multilateral and bilateral donors at every level of procurement. But it is comparatively possible for obtaining approval from China," he added.

Meanwhile, the ERD found in its Aid Flow Publication for last FY2019-20 said there's been a growing trend in the talk about of bilateral aid since FY2010-11.

"Some bilateral development companions such as for example China, Russia and India have grown to be more active in the global help architecture. Bangladesh, like a great many other countries, has been mobilising means from these countries to satisfy its growing investment necessities in the large infrastructures assignments," it said.

Bangladesh government happens to be implementing some nine development projects with Chinese loans totalling $7.1 billion.

The big projects are: Padma bridge rail link, a tunnel under the river Karnaphuli, power grid network strengthening and the installation of single point mooring.

An MoU titled 'Strengthening and Production Potential Cooperation' was signed between Bangladesh and China comprising 27 investment projects under the $21 billion loan bundle in October 2016.
Source: https://thefinancialexpress.com.bd

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