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Dhaka Tribune

‘Bangladesh needs to borrow hard loans to implement mega projects’

Update : 26 Jan 2016, 06:42 PM

Bangladesh would need to borrow a large amount of money from different international financiers to implement mega infrastructural projects, said Finance Minister AMA Muhith. He said some loans might be commercial due to nature of the projects.

“We may collect the funds from different international sources like Government-to-Government loan from China to construct a third terminal at the Hazrat Shah Jalal International Airport,” finance minister told journalists after a meeting with the newly appointed  Executive Director of IMF Board for Asia Pacific Subir Gokarn in Dhaka yesterday.

Subir Gokarn is representing Bangladesh, Bhutan, India and Sri Lanka on the Washington-based IMF’s Executive Board, which is responsible for conducting the day-to-day business of the multilateral institution.

AMA Muhith said the Chinese loan “won’t be concessional but to be in good terms” for construction of the third terminal at the airport. “There are many funding sources, but we have to decide where we would go. Chinese funds are expensive. But funds from global lenders like World Bank and IMF are less expensive than other sources.”  

He added: “We may seek loans from Asian Development Bank and World Bank because of their low interest rates.” “As IMF is unable to provide big loans, we are not seeking money from them for big projects though the lender has already offered us another credit programme.”

IMF board is reviewing conditions if met by Bangladesh under the $1bn extended credit facility which ended recently, said finance minister, adding that the board would try to find weaknesses of the country’s economy.

In reply to a question, AMA Muhith said though the country needed to source funds from international market, the government was cautious that the nation won’t sink under the debt burden as such reality was already faced by many developing nations. 

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