Bangladesh signs $4.5 billion loan deal with India for infra development

Bangladesh has recently signed its third line of credit agreement with India worth $4.5 billion for development of its social and infrastructure sectors. The deal was announced when Bangladesh Prime Minister Sheikh Hasina visited India in April this year; it was reportedly finalised during Indian Finance Minister Arun Jaitley’s trip to Bangladesh. The $4.5 billion deal will enable Bangladesh to buy 65-75 per cent of goods and services from the Indian market. The agreement was signed by Economics Relations Secretary Kazi Shofiqul Azam, and David Rasquinha, Managing Director, Export Import Bank of India, signed the agreement on behalf of India. Jaitley and Bangladeshi Finance Minister AMA Muhith were reportedly in attendance for signing of the deal. The credit from the deal will aid the development of 17 major projects including railways, roadways, ports, electricity and shipping. As per reports, Bangladesh will pay interest at the rate of 1 per cent per annum and will have 20 years and a grace period of five years to pay back the loan. This deal is also expected to serve to strengthen the already good relations between the two countries.