During the visit of the Hon’ble Prime Minister of Bangladesh to India in April 2017, India had announced a third Line of Credit (LOC) of US$ 4.5 Billion to be extended to Bangladesh. The Credit Line Agreement for this US$ 4.5 billion was signed today (4 October 20170 in Dhaka, Bangladesh in the presence of the Minister of Finance and Corporate Affairs of India His Excellency Mr. Arun Jaitley and the Minister of Finance of Bangladesh His Excellency Mr. Abul Maal Abdul Muhith.
The agreement was signed by Mr. David Rasquinha, Managing Director of the EXIM Bank of India and Mr. Kazi Shofiqul Azam, Secretary, Economic Relations Department, Ministry of Finance, Government of Bangladesh. High Commissioner of India Mr. Harsh Vardhan Shringla, Foreign Secretary of Bangladesh Mr. Md. Shahidul Haque and others were present on the occasion.
2. The signing of the LOC agreement will enable the implementation of 17 pre-identified projects of developmental priority to Bangladesh in key sectors of the infrastructure such as power, railways, roads, shipping, ports, etc. As in the case of past Lines of Credit extended by India to Bangladesh, this line of credit is also highly concessional with interest at 1.00% per annum and repayment over a period of 20 years (inclusive of 5 years moratorium).
3. The US$ 4.5 billion LOC is the largest credit line India has extended so far to any country. The First Line of Credit of US$ 1 billion in 2010 has been almost fully utilized with 12 projects completed and the rest in various stages of implementation. Of this $ 1 billion, US $ 200 million was subsequently converted into grant assistance and the credit line was enhanced from US$ 800 million to US$ 862 million in 2015. 15 projects indentified under the Second LOC of US$ 2 billion announced during the visit of the Prime Minister of India to Bangladesh in June 2015 are also under implementation.
4. The signing of this third LOC Agreement is expected to contribute to Bangladesh’s economic development, further integrate the economies of India and Bangladesh and strengthen bilateral economic cooperation. India, as a long standing development partner of Bangladesh, is committed to speedy implementation of project proposals under the third LOC.