The government on Tuesday approved borrowing of $528 million from the overseas banks on high interest rate to foot the oil imports bills, said the officials.
A government body, the hard-term loan committee, at a meeting gave its endorsement to $328 million in credit from the state-owned Philippines oil suppliers and $250 million in syndicated loan from Standard Chartered Bank, HSBC and Citibank NA.
Finance minister Abul Maal Abdul Muhith presided over the meeting at his secretariat office.
PNOC, state-owned Philippines oil producer, will charge 4.5 per cent interest with provision of 150 days of deferred payment. The syndicated loan of $250 million from Standard Chartered Bank, HSBC and Citibank NA will bear 5.03 per cent interest rate having provision of 150 days of deferred payment.
The energy division sought the credit for securing funds for oil supply in the current year.
It placed three proposals before the committee to avail a total of $828 million, but the committed accepted two proposals. The third proposal for $250 million syndicated loan by HSBC and NATIXIS, a French investment bank, was not approved.
Bangladesh Petroleum Corporation chairman Eunusur Rahman, who attended the meeting, said taking loan from the overseas bank on high interest rate was nothing new.
The government has been taking such type of loans to pay short-term bills.
He claimed that interest rate and repayment period of the approved loans were favourable compared to that of the loans taken before.
The country’s dependency on hard-term loan increases as loan available from multinational Islamic Development Bank is not sufficient to meet the growing demand for fuel oils.
The annual import by state-owned BPC went up by more than 35 per cent in 2012 than that in 2011 after two dozen of rental power plants were commissioned during the period.
Bangladesh’s oil imports hit over 5.2 million tonnes last year. The annual bill for the fuel oils import hit close to $4 billion in the same year.
Oil import by the BPC, state-owned oil importer, went up by more than 35 per cent in 2012 than that in 2011 after two dozen of rental power plants were commissioned during the period.
-With New Age input
