Bangla Monday, September 21, 2020

BANGLADESH, JAPAN INK LARGEST LOAN DEAL

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Bangladesh and Japan have signed the largest-ever loan deal, amounting to US$ 3.2 billion, to help Bangladesh become a middle-income country and defeat the novel coronavirus pandemic.

Japanese ambassador to Bangladesh Ito Naoki and ERD secretary Fatima Yasmin signed ‘exchange of notes” of the 41st Official Development Assistance (ODA) of Japan to Bangladesh on Wednesday.

Japan said it will continue to extend its support for the development of Bangladesh as the country is on its way to achieve the highest growth in Asia in this decade of the century.

This year’s loan package comprises assistance of seven projects amounting to JPY 338.247 billion (approximately USD 3.2 billion), the largest ever loan package since its inception in 1974.

Based on this agreement between the two counties, Hayakawa Yuho, chief representative of JICA Bangladesh office and Fatima Yasmin signed a relevant loan agreement, said the Japanese embassy in Dhaka.

Japan has been the single largest bilateral donor for Bangladesh since 2012 and the total amount of its aid as Yen loan has reached US$ 22 billion (commitment base).

The 41st exchange of notes covers the seven major projects.

These are Jamuna Railway Bridge Construction Project (II) (loan amount: 89.016 billion yen), Hazrat Shahjalal International Airport Expansion Project (II) (loan amount: 80 billion yen), Dhaka Mass Rapid Transit Development Project (IV) (loan amount: 72.194 billion yen), Dhaka Mass Rapid Transit Development Project (Line 5 Northern Route) (I) (loan amount: 55.696 billion yen), Chattogram – Cox’s Bazar Highway Improvement Project (E/S) (loan amount: 1.906 billion yen), Food Value Chain Improvement Project (loan amount: 11.218 billion yen) and Urban Development and City Governance Project (loan amount: 28.217 billion yen).

The interest rate is 0.65 per cent per annum (Part concerning payments to consultants: 0.01% per annum) with a repayment period of 20 years and the grace period of 10 years.

The Japanese government has provided approximately US$ 13 million as the emergency support to tackle COVID-19 in Bangladesh through international organisations as well as provided PPE to hospitals through JICA.

Besides, on 16 July, Japan and Bangladesh signed the exchange of notes on Japanese grant aid “Economic and Social Development Programme”(approximately USD 10 million) for medical equipment, including CT scanner, X-ray machine.

These aids focused on medical and health sectors currently combating the novel coronavirus.

On 5 August, both countries signed exchange of notes of the COVID-19 Crisis Response Emergency Support Loan (approximately USD 331 million), which is the first budget support from Japan to Bangladesh.

The purpose of the financial assistance is to provide funding for additional financial expenditure by the government of Bangladesh to implement the economic stimulus package.