Cash-starved Bangladesh eyes dollars in billions

Nizam Ahmed

Nizam Ahmed

Bangladesh, that desperately started seeking overseas funds for building a major infrastructure, has so far been assured of assistance and investment worth $12 billion from two friendly countries in Asia, officials said on Friday. The pledges of the $12 billion investment came almost simultaneously when two official teams from Malaysia and Qatar visited Bangladesh in the ultimate week of the last month, officials at the ministry of foreign affairs (MoFA) said.

Malaysia so far pledged some $9.0 billion including $6.0 billion for a new international airport and rest for the proposed 6.15- kilometre multi-purpose bridge across the river Padma. Qatar so far offered to invest some $3.0 billion for building infrastructure in Bangladesh. The Gulf state is also likely to pledge another $2.5 billion investment in different sectors including energy, officials said.

“All these investment proposals are likely to be registered after the relevant authorities and concerned parties sign required deals and agreements,” said a senior official of the Board of Investment. The cash-starved South Asian country launched the hectic drive after the World Bank (WB) refrained from giving its pledged portion of $1.2 billion for building a $3.0 billion bridge alleging corruption in a bidding process last year.

The WB, probing some alleged irregularities in the bidding process for the bridge, has temporarily barred a unit of SNC-Lavalin, a big Canadian engineering company, from bidding in the Bank’s new projects.

SNC-Lavalin has offices across Canada and in over 40 other countries around the world, and is currently working in some 100 countries. However the WB did not pinpoint which firm in Bangladesh was involved in the attempted corruption, but hinted a firm owned by the then minister of communications was behind the scam. Basing on the WB tips the government swapped the then communications minister with a minister another portfolio, as there was no concrete evidence of attempted corruption. But the move of the government could not satisfy the WB, which also however did not change its stance, even after the removal of the then communications minister by the Bangladesh government.

The construction of the Padma bridge was an election pledge of the government which won a landslide victory in the last general election in late 2008, officials at the ministry of communications said.

“It is our prime project and we want at least to start its construction before conclusion of our present terms in January 2014,” Communications Ministers Obaidul Quader told this correspondent. Following the WB’s action other financers, including Japan International Cooperation Agency ($420 million), Asian Development Bank ($615 million) and Islamic Development Bank ($140 million) have also suspended their pledged funds. Meanwhile the authorities concerned are also expecting more foreign assistance in coming months as the oil-rich Qatar has shown a great interest in investing in oil and gas exploration, power plants, expansion of airports, river dredging and manpower training institutes.

Bangladesh also hopes further pledges of another $2.5 billion investment from Qatar for setting up a proposed 1,000 mega watt liquefied natural gas-fired power plant at Moheskhali off-shore island, expansion of Hazrat Shahjalal International airport, expansion highways, procurement of five river dredger and for setting up a technical training centre, MoFA officials said.

The far eastern nation state Malaysia has offered an aggregated $9.0 billion investment in the bridge and the international airport projects while the Qatar of the Gulf region pledged for constructing the bridge across Padma river. Meanwhile Qatar is also looking for other fields including energy for oil and gas exploration, infrastructure , river dredging and development of human resources. Bangladesh will soon go ahead for exploration of hydrocarbon in its economic zone in the Bay of Bengal as the country won a verdict of The International Tribunal for the Law of the Sea (ITLOS) against Myanmar over maritime boundary dispute.

Malaysian Prime Minister’s special envoy for South Asia Dato S Samy Vellu offered the new and latest investment proposal worth some $6.0 billion for construction of the proposed Bangabandhu Sheikh Mujib International Airport near Dhaka, to Civil Aviation and Tourism Minister Col (retd) Faruk Khan on May 30. The new offer was made when Mr. Samy Vellu visited Dhaka for submitting a formal preliminary proposal for construction of $3.0 billion Padma bridge, which Malaysia agreed earlier and a memorandum of understanding was signed in Kuala Lumpur on April 10.

Earlier in the last week a Qatari official team led by Assistant Minister for International Cooperation Affairs of Qatar Sheikh Ahmed Bin Mohammed Bin Jabr Al Thani, offered some $3.0 billion assistance for building the Padma bridge. As Bangladesh and Malaysia have already signed a MoU for building the Padma bridge, Qatar is likely to join the venture as a third party in the project, MoFA officials said.

“We have already signed a memorandum of understanding with Malaysia. If it is feasible, acceptable and agreed by all the parties, we can have a tripartite agreement,” Foreign Minister Dipu Moni told reporters after meeting with the Qatari delegation on May 28. “If Malaysia and Qatar if really can upkeep their pledges and can really come forward in investing practically, then the world scenario of financing will really change,” an official of the ministry of finance said without giving details.