In Dhaka, PM to loosen purse strings

India may commit $4-5 billion in aid to its neighbour

June 06, 2015 02:35 am | Updated April 03, 2016 02:00 am IST - Dhaka:

India may make commitments for a comprehensive “money flow” at multiple levels to Bangladesh during Prime Minister Narendra Modi’s weekend trip here. Besides an expected credit line of $2 billion, two private-sector power-purchase agreements are on the table, a senior member of the Prime Minister’s delegation said on condition of anonymity here on Friday.

“If the total size of the money flow is put together, it could be somewhere around $4-5 billion,” the official said.

The Bangladeshi side has strongly pushed a detailed plan for a “soft loan” for the information technology (IT) sector. “We have sought $1 billion [credit line] to set up 12 IT parks in 12 districts of Bangladesh,” State Minister of Post, Telecommunications and IT Zunaid Ahmed Pulak told The Hindu .

Bangladesh has proposed to supply 10 gigabyte per second of bandwidth to India, for which an agreement is expected between the public sector telecommunication companies of the two nations. “Bangladesh will make money out of it, while the efficiency of networks will drastically improve in India’s northeast, gasping for [Internet] speed,” Mr. Ahmed said.

Many bilateral agreements are planned, of which two on power exports are expected from the Adani and Reliance groups. “Mr. [Gautam] Adani may accompany the Indian Prime Minister to sign the agreement, while we are still not sure about Mukesh Ambani [Reliance Industries Ltd. chief],” a Bangladeshi official said.

Agreements on transit-transhipment and railway communication and one between the Bureaux of Standards of the two countries are expected.

In an interactive session at the National Press Club here on Friday, Bangladesh State Minister for Foreign Affairs Mohammed Shahriar Alam indicated that Mr. Modi’s visit would lead to steps to reduce the trade deficit.

To facilitate transit and transhipment through Bangladeshi territory, India is expected to provide financial packages for infrastructure development. The two sides may also sign a visa facilitation agreement.

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