Padma Bridge
Chinese firm proposes to invest $2.4b
A Chinese firm yesterday proposed to invest $ 2.4 billion in Padma bridge project, barely two weeks after the government had floated an international tender on June 26.
Communications Minister Obaidul Quader yesterday disclosed the matter after a meeting with a Chinese delegation. He, however, did not say anything about the interest rate of the investment.
The delegation was comprised of officials of Exim Bank, China and Poly Technologies, a state-owned construction company in China.
The proposal came as a big surprise, as the government in January decided to build the 6.12-kilometre bridge with its own fund and on June 26 floated an international tender involving $ 1.18 billion to build the main structure (road and rail line) of the bridge.
The very day, the government floated another tender involving around $ 70 million inviting fresh bids for appointment of the construction supervision consultant for the main bridge.
The tender for river training is also underway.
A day after the tenders had been floated, Finance Minister AMA Muhith told reporters that the government would open a separate foreign currency account of $ 1.2 billion to $ 1.4 billion with the central bank for bearing the foreign exchange liability of the project.
However, briefing journalists on the latest funding proposal yesterday, the communications minister said the construction of the Padma bridge would require a huge amount of foreign exchange. The Chinese proposal, if accepted, could help meet that requirement.
He said the proposal had been sent to the Economic Relations Division for evaluation.
"The proposal was made earlier but this time it has been placed officially," said the minister.
At the meeting, the Chinese delegation showed interest in signing a memorandum of understanding under Government-to-Government (G2G) formation and in funding and building the bridge based on Build-Operate-Transfer (BOT) system, said officials of the communications ministry.
Padma bridge, the country's biggest infrastructure project, had remained stalled until recently since the World Bank raised allegation of corruption conspiracy in the project in September 2011 and cancelled its $ 1.2 billion financing in June last year.
Following a request from the government, the global lender again got involved in the project. But the two sides failed to reach an agreement on the process of investigating the allegation. On January 31 this year, the government withdrew its loan request.
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