A consortium of five Chinese banks offered to invest US$1.8 billion in developing a 1320mw coal-fired power plant in seaside Banskhali Upazila in Bangladesh's southeastern Chittagong district.
Senior officials of the Chinese banks expressed their willingness to put their funds in the joint venture (JV) power project at a meeting held at the Bangladesh Bank headquarters in Dhaka Monday with BB Governor Fazle Kabir in the chair.
The officials sought policy supports from the country's central bank in this connection, meeting sources said.
At the meeting, the delegates of the Chinese banks showed interest in transfer of their funds directly to the borrower without opening any account with bank/banks operating in Bangladesh.
The officials were also interested to know about effective interest rates and the opening of offshore account, they added.
"We'll convey our decisions on the issues after examining the Chinese bankers' proposals," SK Sur Chowdhury, deputy governor of BB, told the FE after the parley.
Terming China a tested friend, the deputy governor said the central bank may extend all kinds of support in line with the existing rules and regulations to encourage foreign direct investment (FDI).
"We need huge investments from both domestic and overseas sources for achieving maximum economic growth," Mr. Sur Chowdhury said, without elaborating.
Present at the meeting among others were senior officials of China Export & Credit Insurance and high-ups of SS Power Limited.
A joint-venture company (JVC) comprising Bangladesh's S Alam Group and Chinese SEPCO-3 Electric Power Constitution Corporation and HTG Group is now working to develop the power plant that costs $2.5 billion.
Earlier on February 16 last year, a signing ceremony on project agreements between the Power Division, Bangladesh Power Development Board (BPDB), Power Grid Company of Bangladesh (PGCB) and SS Power-1 Ltd and SS Power-2 Ltd took place at Bidyut Bhaban in Dhaka.
The government had picked SS Power-1 Ltd for the construction of first unit through a tender process while SS Power-2 Ltd was given an unsolicited deal to construct the second unit under the Power and Energy Quick Supply Act 2015.
Under the deals, the government will buy electricity from these plants at 8.259 US cents/kWh (levellized tariff).
The power project is scheduled to go into commercial production by November 2019.
"We've already started development works of the project," a company official told the FE.
He also said around 150 people are now working on the project.
About 7,000 people will be employed in the project in the first five years, the official added.
"Some 1,000 people will be directly employed permanently after completion of the project while another 6,000 will get indirect employment," he said to explain the benefits to be accrued from the major power project.
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Source: The Financial Express