India to invest $10bn in Bangladesh power and energy sector

India to invest $10bn in Bangladesh power and energy sector

Kolkata Correspondent,

India is going to invest nearly $10 billion in Bangladesh’s power and energy sector. A total of 13 MoUs and deals were signed at a business forum in Delhi on 10 April when Bangladesh Prime Minister Sheikh Hasina attended the business forum as chief guest. She highlighted Bangladesh’s achievements in the last few years and invited Indian businessmen to invest in Bangladesh. “Take full advantage of the steady economic growth, high demographic dividend, competitive business costs and large consumer base,” she told them.

A large business delegation comprising 237 members from Bangladesh, led by the President of the Federation of Bangladesh Chambers of Commerce & Industry (FBCCI), Mr. Abdul Matlub Ahmad, interacted with nearly 150 members from the Indian business community at the Forum.

During Hasina’s visit, India also offered a $5 bn loan to Bangladesh. The credit will be used for the development of several sectors including logistics, education, medical, infrastructures and rail, road and waterways.

India has readily agreed to invest $3.15 bn to supply power to Bangladesh from Nepal. NTPC is to sign a deal with Bangladesh in this regard.

India’s Reliance Power and the Ministry of Power, Energy and Mineral Resources of Bangladesh signed an agreement for the first phase (718 MW) of the 3,000 MW power project at Meghna-Ghat. India’s Exim Bank will finance $1.6 bn power project in Bangladesh.

A $2 bn deal between Adani Power of India and the Power Grid Company of Bangladesh was also signed to supply power to Bangladesh.

Reliance Power of India signed a $300 million MoU with PetroBangla for setting up 500 MMCFD LNG terminal at Kutubdia.

Petro-Bangla inked another MoU with India Oil Corporation Limited for LNG cooperation.

Petronet LNG and Bangladesh Petroleum Corp struck $1 billion agreement for LNG terminal use with Petrobangla.

India’s Numaligarh Refinery signed a pact with BPC for sale and purchase of gas and oil.

A supplementary agreement was signed between NTPC Vidyut Vyapar Nigam Limited and Bangladesh Power Development Board for supply of additional 60MW from Tripura.

Controversial Investment in Rampal

A controversial 1320 MW coal power plant is being built at Rampal on the edge of the Sundarbans, the world’s largest mangrove forest and a world heritage site declared by UNESCO. Since 2010, environmentalists and left political parties have vehemently protested against the project as it will spell disaster for the world’s largest mangrove forest, while locals worry about pollution and being driven from their homes. They even staged a march on the road to reallocate the plant. UNESCO and the Ramsar Convention have also raised concerns over the possible impact of the mega scheme.

The government maintains that it will not harm the biodiversity of the UNESCO World Heritage Site or the nearby Pasur River, which is a sanctuary for sweetwater dolphins.

Moreover, the Bangladesh government took another major step in going ahead with the construction of the mega coal power plant after it has signed the much-awaited deal with Indian Exim Bank to finance the joint venture project during Hasina’s visit. The “facility agreement” between Bangladesh India Friendship Power Company Limited (BIFPCL) and the Exim Bank is one of the 13 MoUs and deals signed at a business forum in Delhi.

This mega power project will be big enough to provide around 10% of the country’s electricity generation. It’s scheduled to be operational from 2020. The project is owned jointly by Bangladesh and India’s state-owned energy utilities, which each have 15% equity, while the remaining 70% of the total funding is expected to come from bank loans.