Home Today's Paper Most Popular Video Gallery Photo Gallery
Subscription Blog Signin Register
Logo
Saturday, September 22, 2018 10:16:08 AM
Follow Us On: Facebook Twitter Twitter Twitter Twitter
BREAKING NEWS:

Large projects

Costly foreign loans to invite worse impact

By Special Correspondent
18th-Jul-2016       
Comments
Share your thought
Post a comment »
Read all () »

Economists have expressed concern over the government's appetite  on expensive foreign borrowings for funding mega projects saying that such costly overseas loans will increase the burden on national exchequer on account of debt servicing.
The committee on non-consessional loan has recently given the clean chit to the government over the highly expensive foreign commercial borrowings equivalent to Tk 94,000 crore for developing Rooppur Nuclear Power Plant, Bangabandhu Satellite and 400MW Ashuganj Power Plant.
The loan repayment period is 15-20 years, the grace period is 5-10 years, and the interest rate is 2.0-4.0 per cent (LIBOR plus other charges).
"I do not see the justification in taking this type of hard loans by the government when many doubt cost benefit of the projects," Dr Ahsan H Monsoor, a leading economist of the country told The New Nation on Sunday.
"As the Rooppur Atomic Power Plant and Bangabandhu Satellite launching projects lack economic viability and cost benefit, the nation would have to pay heavily for the costly foreign borrowings to implement these projects", he warned.
 Terming the Rooppur Nuclear Power Plant a 'controversial' project, Dr Ahsan Monsur said, "The government will have to make huge capital investment amounting to US$ 12.65 billion for developing the project. Russia will finance 90 per cent of the total project cost as hard term credit. It's a huge project having lengthy implementation process with expensive borrowing norms. All these can inflict huge financial 'distress costs' on Bangladesh economy."      Instead of taking up the project, Dr Mansur said, the government should mobilize such a large amount of capital to implement productive sectors having immediate economic benefit within a short period.
"Costly foreign commercial loans will push up the debt servicing liability of the national exchequer and increase the government's external debt burden as such borrowings are three to four times costlier than G-to-G loans and those from multilateral lending agencies," Dr AB Mirza Azizul Islam, another leading economist of the country, told The New Nation on Sunday.
The government has opted for such commercial borrowing mainly due to   multilateral donors' apathy in financing these projects. Donors may not show interest into the project financing taking into account their economic viability.
When asked, Mirza Aziz said commercial borrowing from foreign lenders could turn sour if the country fails to replay the loans timely and the government fails to implement the project within the scheduled timeframe.
"Default should also be averted through prudent economic management", he said
As on December 31, 2015, the country's external debt was US$ 23.50 billion and more than 75 per cent of the external debt was on concessional terms.

Tariff
Add Rate

News Archive

Inside The New Nation

Editorial »

Rohingya crisis: UN is helpless without active cooperation of int'l community


THE United Nations was established with a mission to stop brutality and promotion of human rights across the globe but at present is apparently helpless to stop the Myanmar military atrocity on Rohingya ethnic community. Though the Universal Declaration of Human Rights, International Covenant on Civil and Political Rights, the ...

Cricket »

India rout Pakistan by eight wickets in Asia Cup


AFP, Dubai :India crushed Pakistan by eight wickets in their long-awaited Asia Cup match which failed to live up to its hype in Dubai on Wednesday.Pace spearhead Bhuvneshwar Kumar (3-15) and part time off-spinner Kedar Jadhav (3-23) sent Pakistan, who won the toss and batted, collapsing to just 162 all ...

Football »

We aim to play SAFF U-16 Women's final: Choton


Bangladesh U-18 national women's football team head coach Golam Rabanni Choton said they aim to play the final of the SAFF U-18 Women's Championship which is scheduled to be held from September 28 to October 7 in Thimpu, Bhutan.He was speaking at a pre-departure press conference on Thursday at the ...

International »

US-North Korea relations making 'tremendous progress': Trump


President Donald Trump on Wednesday said US relations with North Korea are making "tremendous progress" from the days before his presidency when the two countries appeared close to "going to war."Trump said a recent letter from North Korean leader Kim Jong Un confirmed the positive track, which he said has ...

City »

Newly elected executive members of Bangladesh Photo Journalists Association paid a courtesy call on Shipping Minister Shajahan Khan at his ministry on Thursday.


Entertainment »

Not always necessary to do issue-based films: Yami Gautam


Actress Yami Gautam, who stars in Batti Gul Meter Chalu, says it is neither necessary nor possible for an actor to do issue-based films all the time. Yami was interacting with the media here on Wednesday at a promotional press conference of the film that releases on Friday. She was ...

Football »

Japanese MMA star Norifumi 'Kid' Yamamoto dies at 41


Tributes flowed Wednesday for charismatic Japanese Mixed Martial Artist ( MMA) Norifumi "Kid" Yamamoto, who died at age 41, three weeks after announcing a battle with cancer.Born to a family of wrestlers and martial artists, the wiry, tattoo-covered Yamamoto took on larger opponents in a wide range of MMA events, ...

Editorial »

Ecological danger for destroying forest by Rohingyas


A STUDY has revealed that 4,300 acres of hills and forests have been razed in Cox's Bazar to set up refugee camps and cooking fuel for Rohingyas who fled ethnic cleansing in Myanmar. Quoting the study, news media reported that about 3,000-4,000 acres of hill land at Teknaf and Ukhia ...

International »

Kim agrees to dismantle main nuke site if US takes steps too


AP,  Pyongyang :The leaders of North and South Korea announced a wide range of agreements Wednesday which they said were a major step toward peace on the Korean Peninsula. But the premier pledge on denuclearization contained a big condition, with North Korean leader Kim Jong Un stating he'd permanently dismantle ...

International »

Sex with Trump 'least impressive' she's ever had: Daniels


Stormy Daniels, the porn star who claims to have slept with Donald Trump over a decade ago, says in her upcoming tell-all book that it may have been the "least impressive sex" she'd ever had, The Guardian reported Tuesday.In her book, "Full Disclosure," Daniels also provides a graphic description of ...

Entertainment »

I`m seen as a fierce and opinionated woman post Bigg Boss: Hina Khan


Actor Hina Khan believes Bigg Boss helped her showcase her real personality, which is that of a woman who does not shy away from speaking her mind. The actor became one of the most talked about contestants on the 11th edition of the reality TV show, which has just begun ...

City »

Dhaka University teachers formed a human chain programme on the campus on Wednesday demanding release and proper treatment of BNP Chairperson Khaleda Zia.


Editorial »

We welcome Islamabad for awarding Bangladeshi-origin refugees Pakistan`s nationality


PAKISTAN government has decided to grant nationality to all Pakistan-born refugees of Bangladeshi and Afghan origins staying there for decades. Prime Minister Mr Imran Khan on Sunday made this announcement during his maiden visit to Karachi, saying the Bangladeshi and Afghan refugees who were born in Pakistan would get National ...

Sports »

Argentina's Facundo Conte (left) and teammate Alexis Gonzalez celebrate during the Men's World Championships' volleyball match between Argentina and Slovenia, in Florence, Italy on Monday.


Football »

FIFA president Infantino has doubts about La Liga match in Miami


AFP, Barcelona :FIFA president Gianni Infantino has expressed concern about La Liga's proposal to stage a fixture between Girona and Barcelona in the United States.The two clubs have each approved a request submitted to the Spanish Football Federation for the match to be played at the Hard Rock Stadium in ...

 
Items that you save may be read at any time on your computer, iPad, iPhone or Android devices.
 
Are you new to our website? Do you have already an account at our website?
Create An Account Log in here
Email this news to a friend or like someone
Email:
Write a comment to this news